Filter by Categories
Accounting
Banking

Finance




Imputed Interest


In connection with discount debt instruments, it is the interest that would be earned by holding an instrument to maturity. This interest is usually earned from coupon payments adjusted for changes in the instrument’s market value (plus or minus the market value) as the instrument gets closer to its redemption or par value.

Imputed interest is the estimated interest rate on an instrument, rather than the rate it carries. It is is the interest that a lender expects to collect, regardless of the actual interest the lender receives.

For internal revenue service (IRS), the concept of imputed interest revolves around the calculation of interest that a lender should have paid for tax purposes even if there were no actual interest received by that lender.



ABC
Finance, as a field of knowledge, is substantially wide-ranging and virtually encompasses everything in the realm of corporate finance, financial management, ...
Watch on Youtube
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments


    Leave Your Comment

    Your email address will not be published.*