Abstract: A tool holder for a recess cutting tool that is used to make a recess cut in a workpiece is disclosed. The tool holder is positioned on a machine tool and the machine tool has a spindle for holding the workpiece and a moveable tool slide for advancing the recess cutting tool towards the workpiece. The tool holder has a tool carrier means positioned on the moveable tool slide and the tool carrier means is adapted for securely holding the recess cutting tool. The tool carrier means is disposed for advancing with the tool slide towards the workpiece and being radially displaced with respect to the tool slide to make a recess cut in the workpiece. An adjustable rod is connected to the tool carrier means. The rod extends from the tool carrier means in a direction towards the workpiece. An adjustment stop is positioned on the machine tool adjacent the workpiece. The stop extends from the machine tool towards the tool carrier means.