original-issue discount (OID)

original-issue discount (OID) definition - business

original-issue discount (OID)

The amount by which a bond is sold below its par value at the time of issue. With the exception of usually tax-free securities (that is, municipals), investors must report a certain portion of the discount as income for tax purposes each year.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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