Skip to main content
Message Font: Serif | Sans-Serif
No. of Recommendations: 1
Depending on how large a bond we're talking about, I would certainly be tempted to just report it with the basis matching the return of capital (so no gain or loss). For a small enough bond, there is no functional difference. I would certainly do it for a $5000 bond, and I certainly would NOT take the shortcut on $1 million of original bond. Somewhere in between is a switchover point.

I should also mention that this shortcut is definitely NOT an option with a zero coupon bond. Zeros are the whole reason all of these discount/premium amortization rules came in to being.

Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.