Internal Revenue Code (Title 26 U.S.C.)
26 U.S.C. § 1288
Treatment of original issue discount on tax-exempt obligations
# (a) General rule
Original issue discount on any tax-exempt obligation shall be treated as accruing— (1) for purposes of section 163, in the manner provided by section 1272(a) (determined without regard to paragraph (7) thereof), and (2) for purposes of determining the adjusted basis of the holder, in the manner provided by section 1272(a) (determined with regard to paragraph (7) thereof).
# (b) Definitions and special rules
For purposes of this section— (1) Original issue discount The term "original issue discount" has the meaning given to such term by section 1273(a) without regard to paragraph (3) thereof. In applying section 483 or 1274, under regulations prescribed by the Secretary, appropriate adjustments shall be made to the applicable Federal rate to take into account the tax exemption for interest on the obligation. (2) Tax-exempt obligation The term "tax-exempt obligation" has the meaning given to such term by section 1275(a)(3). (3) Short-term obligations In applying this section to obligations with maturity of 1 year or less, rules similar to the rules of section 1283(b) shall apply.
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Nearby sections (25 sections)
- 1273 · Determination of amount of original issue discount
- 1274 · Determination of issue price in the case of certain debt…
- 1274A · Special rules for certain transactions where stated principal…
- 1275 · Other definitions and special rules
- 1276 · Disposition gain representing accrued market discount treated as…
- 1277 · Deferral of interest deduction allocable to accrued market…
- 1278 · Definitions and special rules
- 1281 · Current inclusion in income of discount on certain short-term…
- 1282 · Deferral of interest deduction allocable to accrued discount
- 1283 · Definitions and special rules
- 1286 · Tax treatment of stripped bonds
- 1287 · Denial of capital gain treatment for gains on certain…
- 1288 · Treatment of original issue discount on tax-exempt obligations
- 1291 · Interest on tax deferral
- 1293 · Current taxation of income from qualified electing funds
- 1294 · Election to extend time for payment of tax on undistributed…
- 1295 · Qualified electing fund
- 1296 · Election of mark to market for marketable stock
- 1297 · Passive foreign investment company
- 1298 · Special rules
- 1301 · Averaging of farm income
- 1311 · Correction of error
- 1312 · Circumstances of adjustment
- 1313 · Definitions
- 1314 · Amount and method of adjustment