Capitalized interest

Capitalized interest

Interest that is not immediately expensed, but rather is considered as an asset and is then amortized through the income statement over time. In the context of project financing, interest that is paid by additional borrowing.

Capitalized Interest

Funds that an issuer places into a separate account in order to pay for future coupons on a bond. Capitalized interest is considered an asset and may be deducted from the issuer's taxes over time. There is disagreement about the benefits of this deduction; some issuers prefer to receive the deduction at once, rather than over time.
References in periodicals archive ?
In accordance with the terms and conditions of the bond, the bondholders have a right to convert the bond notes and the accrued capitalized interest related to the notes into Suominen shares.
Summary: After failing to gather a quorum (75%) at its noteholder meeting, XXI Century (XXIC) announced its cash position is insufficient to meet the scheduled repayment of principal and capitalized interest
For this purpose, OID can include capitalized interest and loan origination fees.
These changes will simplify the computation of capitalized interest under section 263A(f).
If the asset is acquired for sale, the capitalized interest is expensed through the cost of goods sold account when the asset is sold.
This, of course, leads to smaller interest expense and larger capitalized interest for income tax computations than for financial calculations.
Credit enhancement in the trust consists of excess spread, overcollateralization, and liquidity in the form of a capitalized interest account.
For tax years 1994-1997, T computed capitalized interest under the Sec.
27,075,000 class D floating rate capitalized interest notes due 2042 'A+';
The credit is equal to 10% of the equipment's original total capitalized cost, less capitalized interest.
0 million; and the $20,000,000 capitalized interest account.
95-19 if it erroneously capitalized no interest; capitalized interest, but erroneously computed the amount of interest required to be capitalized; or capitalized the correct amount of interest, but now wants to take advantage of a more favorable option in the final regulations, such as using an annual computation period that minimizes the compounding of capitalized interest or using the more liberal rule for expensing interest incurred during production suspension periods adopted in the final regulations.