Business, Legal & Accounting Glossary
Requires capital gains taxes are paid on bonds if the bond was purchased at a discount price which is greater than a quarter point per year between the day it was purchased and the maturity date. To calculate whether or not you need to pay de minimis tax on your bond, determine the number of years between the date you purchased the bond and the maturity date then multiple by .25. Subtract the amount you get from that calculation from the bond’s par value. If the amount is higher than the purchase price, you need to pay capital gains tax.
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This glossary post was last updated: 20th November, 2021 | 0 Views.