Glossary of Municipal Securities Terms

MARKET DISCOUNT BOND

bond purchased in the secondary market at a price that is less than the original issue price plus the accreted original issue discount, if any, through the date of purchase. This market discount may be treated differently than original issue discount for federal income tax purposes. See: ACCRETION OF DISCOUNT; DE MINIMIS DISCOUNT; DISCOUNT. Compare: ORIGINAL ISSUE DISCOUNT BOND.

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