De Minimis Amount [Internal Revenue] Law and Legal Definition
Pursuant to 26 CFR 1.148-1 (b) [Title 26 Internal Revenue; Chapter I Internal Revenue Service, Department of the Treasury; Subchapter A Income Tax; Part 1 Income Taxes; Normal Taxes and Surtaxes; Computation of Taxable Income; Tax Exemption Requirements for State and Local Bonds], the term De Minimis Amount means --
“(1) In reference to original issue discount (as defined in section 1273(a)(1) [26 USCS § 1273(a)(1)]) or premium on an obligation --
(i) An amount that does not exceed 2 percent multiplied by the stated redemption price at maturity; plus
(ii) Any original issue premium that is attributable exclusively to reasonable underwriters' compensation; and
(2) In reference to market discount (as defined in section 1278(a)(2)(A) [26 USCS § 1278(a)(2)(A)]) or premium on an obligation, an amount that does not exceed 2 percent multiplied by the stated redemption price at maturity.”
