Debt instrument


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Debt instrument

An asset requiring fixed dollar payments, such as a government or corporate bond.
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Under the general rule, a covered debt instrument is treated as stock for federal tax purposes if it is issued by a covered member to a member of its expanded group in a distribution, in exchange for stock of an expanded group member, or in exchange for property in an asset reorganization.
A disqualified debt instrument means any debt of a corporation that is "payable in equity," which refers to either: (1) equity of the issuer or a party related to the issuer; or (2) equity held by the issuer or a party related to the issuer.
Options on debt instruments: To conform the reporting requirements for gross proceeds on an option on a debt instrument that requires a payment of either interest or principal in a currency other than the U.
1001-3(b) provides that if an outstanding instrument is modified, or is actually exchanged for a new debt instrument, the modification or exchange is not a taxable exchange for purposes of Treas.
Generally, a holder of a regular interest is taxed as if the regular interest were a debt instrument, except that a holder must account for income from the interest on an accrual basis (regardless of the accounting method otherwise used by the holder).
An applicable debt instrument is any debt instrument issued by a C corporation or any other person in connection with the conduct of a trade or business.
Another concern is that the debt instrument of the acquired company might have a change of control provision where there are prepayment penalties.
If a new debt instrument is issued in satisfaction of existing debt, the new debt is treated as having paid off the existing debt with an amount of money equal to the issue price (determined under the original issue discount (OID) rules of Secs.
He said the returns on debt instruments were largely fixed which eliminated the uncertainty associated with most other capital market instruments such as equity.
In other words, the broker can assume that the customer has not made any elections with respect to the debt instrument.
The five-year debt instrument is expected be sold at 245 basis points over mid-swaps.