Later bankruptcy of spouse. If the debtor's spouse files for bankruptcy later in the same year, he or she may also choose to end his or her tax year, regardless of whether he or she joined in the election to end the debtor's tax year. As each spouse has a separate bankruptcy, one or both of them may have 3 short tax years in the same calendar year. If the debtor's spouse joined the debtor's election or if the debtor had not made the election to end the tax year, the debtor can join in the spouse's election.
However, if the debtor made an election and the spouse did not join that election, the debtor cannot then join the spouse's later election. The debtor and the spouse are precluded from this election because they have different tax years. This results because the debtor does not have a tax year ending the day before the spouse's filing for bankruptcy, and the debtor cannot file a joint return for a year ending on the day before the spouse's filing of bankruptcy. Example 1. Paul and Mary Harris are calendar-year taxpayers.
Paul's voluntary chapter 7 bankruptcy case begins on March 4. If Paul does not make an election, his tax year does not end on March 3. If he makes an election, Paul's first tax year is January 1—March 3, and his second tax year begins on March 4. Mary could join in Paul's election as long as they file a joint return for the tax year January 1—March 3. They must make the election by July 15, the due date for filing the joint return.
Example 2. Fred and Ethel Barnes are calendar-year taxpayers. Fred's voluntary chapter 7 bankruptcy case begins on May 6, and Ethel's bankruptcy case begins on November 1 of the same year. Ethel could elect to end her tax year on October If Fred did not elect to end his tax year on May 5, or if he elected to do so but Ethel had not joined in his election, Ethel would have 2 tax years in the same calendar year if she decided to close her tax year.
Her first tax year is January 1—October 31, and her second year is November 1—December If Fred did not end his tax year as of May 5, he could join in Ethel's election to close her tax year on October 31, but only if they file a joint return for the tax year January 1—October If Fred elected to end his tax year on May 5, but Ethel did not join in Fred's election, Fred cannot join in Ethel's election to end her tax year on October Fred and Ethel cannot file a joint return for that short tax year because their tax years preceding October 31 were not the same.
Example 3. Jack and Karen Thomas are calendar-year taxpayers. Karen's voluntary chapter 7 bankruptcy case began on April 10, and Jack's voluntary chapter 7 bankruptcy case began on October 3 of the same year. Karen elected to close her tax year on April 9 and Jack joins in Karen's election. Under these facts, Jack would have 3 tax years for the same calendar year if he makes the election relating to his own bankruptcy case.
Karen may join in Jack's election if they file a joint return for the second short tax year April 10—October 2. If Karen does join in, she would have the same 3 short tax years as Jack. Also, if Karen joins in Jack's election, they may file a joint return for the third tax year October 3—December 31 , but they aren't required to do so. Annualizing taxable income.
If the debtor elects to close the tax year, the debtor must annualize taxable income for each short tax year in the same manner a change in annual accounting period is calculated. See Short Tax Year in Pub. Dismissal of bankruptcy case. If the bankruptcy court later dismisses an individual chapter 7 or 11 case, the bankruptcy estate is no longer treated as a separate taxable entity.
It is as if no bankruptcy estate was created for tax purposes. In this situation, the debtor must file amended tax returns on Form X to replace all full or short year individual returns Form or SR and bankruptcy estate returns Form filed as a result of the bankruptcy case.
Income, deductions, and credits previously reported by the bankruptcy estate must be reported on the debtor's amended returns. Attach a statement to the amended returns explaining why the debtor is filing an amended return. Taxes and the Bankruptcy Estate Property of the bankruptcy estate.
At the commencement of a bankruptcy case, a bankruptcy estate is created. Bankruptcy law determines which of the debtor's assets become part of a bankruptcy estate. This estate generally includes all of the debtor's legal and equitable interests in property as of the commencement date. However, there are exceptions and certain property is exempted or excluded from the bankruptcy estate. Exempt property and abandoned property are initially part of the bankruptcy estate, but are subsequently removed from the estate.
Excluded property is never included in the estate. Transfer of assets between debtor and bankruptcy estate. The transfer other than by sale or exchange of an asset from the debtor to the bankruptcy estate isn't treated as a disposition for income tax purposes.
The transfer does not result in gain or loss, acceleration of income or deductions, or recapture of deductions or credits. For example, the transfer of an installment obligation to the estate would not accelerate gain under the rules for reporting installment sales. The estate assumes the same basis, holding period, and character of the transferred assets.
Also, the estate generally accounts for the transferred assets in the same manner as the debtor. When the bankruptcy estate is terminated or dissolved, any resulting transfer other than by sale or exchange of the estate's assets back to the debtor is also not treated as a disposition for tax purposes. The transfer does not result in gain or loss, acceleration of income or deductions, or recapture of deductions or credits to the estate.
Abandoned property. The abandonment of property by the estate to the debtor is a nontaxable disposition of property. If the debtor received abandoned property from the bankruptcy estate, the debtor assumes the same basis in the property that the bankruptcy estate had. Separate taxable entity. When an individual files a bankruptcy petition under chapter 7 or 11, the bankruptcy estate is treated as a separate taxable entity from the debtor. The court appointed trustee or the debtor-in-possession is responsible for preparing and filing all of the bankruptcy estate's tax returns, including its income tax return, on Form , and paying its taxes.
The debtor remains responsible for filing his or her own returns on Form or SR and paying taxes on income that does not belong to the estate. Employer identification number EIN. The trustee or debtor-in-possession must obtain an EIN for a bankruptcy estate.
The trustee or debtor-in-possession uses this EIN on all tax returns filed for the bankruptcy estate with the IRS, including estimated tax returns. The social security number of the individual debtor cannot be used as the EIN for the bankruptcy estate.. Income, deductions, and credits—Form or SR. In an individual chapter 7 or 11 bankruptcy case, don't include the income, deductions, and credits that belong to the bankruptcy estate on the debtor's individual income tax return Form or SR.
Also, don't include as income on the debtor's return the amount of any debt canceled by reason of the bankruptcy discharge. The bankruptcy estate must reduce certain losses, credits, and the basis in property to the extent of these items by the amount of canceled debt. The debtor may not be able to claim certain deductions available to the bankruptcy estate such as administrative expenses. Additionally, the bankruptcy exclusion cannot be used to exclude income from a cancelled debt if the discharge of indebtedness was not within the bankruptcy case, even though the debtor was under the bankruptcy court's protection at the time.
However, other exclusions, such as the insolvency exclusion, may apply. The gross income of the bankruptcy estate includes gross income of the debtor to which the estate is entitled under the Bankruptcy Code. Gross income also includes income generated by the bankruptcy estate from property of the estate after the commencement of the case.
Gross income of the bankruptcy estate does not include amounts received or accrued by the debtor before the commencement of the case. Additionally, in chapter 7 cases, gross income of the bankruptcy estate does not include any income that the debtor earns after the date of the bankruptcy petition.
Income of the estate in individual chapter 11 cases. In chapter 11 cases, under Internal Revenue Code section e 1 , gross income of the bankruptcy estate includes income that the debtor earns for services performed after the bankruptcy petition date. Also, earnings from services performed by an individual debtor after the commencement of the chapter 11 case are property of the bankruptcy estate under section of the Bankruptcy Code 11 U.
A debtor-in-possession may be compensated by the estate for managing or operating a trade or business that the debtor conducted before the commencement of the bankruptcy case. Such payments should be reported by the debtor as miscellaneous income on his or her individual income tax return Form or SR.
Amounts paid by the estate to the debtor-in-possession for managing or operating the trade or business may qualify as administrative expenses of the estate. See Administrative expenses, later. Conversion or dismissal of chapter 11 cases. If a chapter 11 case is converted to a chapter 13 case, the chapter 13 estate isn't a separate taxable entity and earnings from post-conversion services and income from property of the estate realized after the conversion to chapter 13 are taxed to the debtor.
If the chapter 11 case is converted to a chapter 7 case, 11 U. Any income on this property will be taxed to the estate even if the income is realized after the conversion to chapter 7. If a chapter 11 case is dismissed, the debtor is treated as if the bankruptcy case had never been filed and as if no bankruptcy estate had been created.
Bankruptcy Estate Deductions and Credits A bankruptcy estate deducts expenses incurred in a trade, business, or activity, and uses credits in the same way the debtor would have deducted or credited them had he or she continued operations. Expenses may be disallowed under other provisions of the Internal Revenue Code such as the disallowance of certain capital expenditures or expenses relating to tax-exempt interest. Administrative expenses.
Allowable expenses include administrative expenses. Administrative expenses can only be deducted by the estate, never by the debtor. The bankruptcy estate is allowed deductions for bankruptcy administrative expenses and fees, including accounting fees, attorney fees, and court costs. These expenses are deductible on Schedule 1 Form , as allowable in arriving at adjusted gross income because they would not have been incurred if property had not been held by the bankruptcy estate.
Administrative expenses of the bankruptcy estate attributable to conducting a trade or business or for the production of estate rents or royalties are deductible in arriving at adjusted gross income on Form or SR, Schedules C, E, and F. The bankruptcy estate uses Form as a transmittal for the tax return prepared using Form or SR and its schedules. Administrative expense loss. If the administrative expenses of the bankruptcy estate are more than its gross income for a tax year, the excess amount is an administrative expense loss AEL.
An AEL may be carried back 3 years and forward 7 years. The AEL amounts can only be carried to a tax year of the estate and never to a debtor's tax year. An AEL must first be carried back to the earliest year possible. However, NOL carrybacks see Carrybacks from the bankruptcy estate, later, regarding farm losses and carryovers must be applied against income of the estate and are reduced before administrative loss carrybacks and carryovers. See Internal Revenue Code section h 2 C.
Attribute carryovers. The bankruptcy estate may use its tax attributes the same way that the debtor would have used them. These items are determined as of the first day of the debtor's tax year in which the bankruptcy case begins.
The bankruptcy estate assumes the following tax attributes from the debtor: NOL carryovers. Carryovers of excess charitable contributions. Recovery of tax benefit items. Credit carryovers. Basis, holding period, and character of assets. Method of accounting. Passive activity loss and credit carryovers.
Unused at-risk deductions. Other tax attributes provided in the regulations. Certain tax attributes of the bankruptcy estate must be reduced by the amount of income that was previously excluded as a result of cancellation of debt during the bankruptcy proceeding.
When the bankruptcy estate is terminated for example, when the case ends , the debtor assumes any remaining tax attributes previously taken over by the bankruptcy estate. The debtor also generally assumes any of the tax attributes, listed above, that arose during the administration of the bankruptcy estate. The debtor does not assume the bankruptcy estate's administrative expense losses because they cannot be used by an individual taxpayer filing Form or SR.
See Administrative expense loss, earlier. Passive and at-risk activities. For bankruptcy cases beginning after November 8, , passive activity carryover losses and credits and unused at-risk deductions are treated as tax attributes passing from the debtor to the bankruptcy estate, which the estate then passes back to the debtor when the bankruptcy estate terminates. Additionally, transfers to the debtor other than by sale or exchange of interests in passive or at-risk activities are treated as nontaxable exchanges.
These transfers include the return of exempt property and abandonment of estate property to the debtor. Carrybacks from the debtor's activities. The debtor cannot carry back any NOL or credit carryback from a tax year ending after the bankruptcy case has begun to any tax year ending before the case began. Carrybacks from the bankruptcy estate. The estate may carry back excess credits, such as the general business credit, to the pre-bankruptcy tax years. See Pubs.
Tax Reporting—Chapter 11 Cases Allocation of income and credits on information returns and required statement for returns for individual chapter 11 cases. In chapter 11 cases, when an employer issues a Form W-2 reporting all of the debtor's wages, salary, or other compensation for a calendar year, and a portion of the earnings represent post-petition services includible in the estate's gross income, the Form W-2 amounts must be allocated between the estate and the debtor.
The debtor-in-possession or trustee must allocate the income amount reported in box 1 and the income tax withheld reported in box 2 between the debtor and the estate. These allocations must reflect that the debtor's gross earnings from post-petition services and gross income from post-petition property are, generally, includible in the estate's gross income and not the debtor's gross income.
The debtor and trustee may use a simple percentage method to allocate income and income tax withheld. The same method must be used to allocate the income and the withheld tax. See Internal Revenue Code section 31 a. If information returns are issued to the debtor for gross income, gross proceeds, or other reportable payments that should have been reported to the bankruptcy estate, the debtor-in-possession or trustee must allocate the improperly reported income in a reasonable manner between the debtor and the estate.
In general, the allocation must ensure that any income and income tax withheld attributable to the post-petition period is reported on the estate's return, and any income and income tax withheld attributable to the pre-petition period is reported on the debtor's return. IRS Notice requires the debtor to attach a statement to his or her individual income tax return Form or SR stating that the return is filed subject to a chapter 11 bankruptcy case.
The statement must also: Show the allocations of income and income tax withheld; Describe the method used to allocate income and income tax withheld; and List the filing date of the bankruptcy case, the bankruptcy court in which the case is pending, the bankruptcy court case number, and the bankruptcy estate's EIN. The debtor-in-possession or trustee must attach a similar statement to the bankruptcy estate's income tax return Form The model Notice Statement, shown later, may be used by debtors, debtors-in-possession, and trustees to satisfy the reporting requirement.
Self-employment taxes in individual chapter 11 cases. Internal Revenue Code section imposes a tax upon the self-employment income, that is, the net earnings from self-employment of an individual. Dlabay has served as a consultant to corporations, educational institutions, and government agencies. He has presented more than workshops and seminars in over 20 states to encourage teachers to actively involve students in the learning process with video presentations, newsletters, interviews, and Internet research activities.
Robert J. Hughes Professor of business at Dallas County Community Colleges, believes that these two words can literally change people's lives. Whether you want to be rich or just manage the money you have, the ability to analyze financial decisions and gather financial information are skills that can always be improved. In addition to writing several textbooks, Dr. Hughes has taught personal finance, introduction to business, business math, small business management, small business finance, and accounting since
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Stocks or Bonds in Today's Stock Market?AIDING AND ABETTING A FUGITIVE GANGSTERS
Recreational travel trailers are towed by a motor vehicle and are not more than eight feet wide or longer than 40 feet. Collapsible trailers and camping trailers fall under the category of recreational travel trailer. The weight conversion chart below can be used when only the length of a travel trailer is known. It will assist in computing the registration fees for recreational travel trailers. A permanent freight trailer plate is issued upon the initial registration of a freight trailer.
Trailers exempt from registration include utility trailers that are owned by individuals engaged in the business of farming and ranching. These trailers do not have to be registered as long as they are pulled by a vehicle which has a gross vehicle weight rating of less than 10, pounds and are:. Freight trailers will be registered once. At the time of resale, the new owner will be required to pay the registration fee in their own name. Both the vehicle and Certificate of Registration will be permanent for the life of the vehicle.
Utility trailers and travel trailers not used in commerce whose gross vehicle weight is under 6, lbs. If the registration certificate does not indicate the vehicle identification number because the trailer is homemade or shop-built, the transaction shall be processed as a first-time homemade trailer:. If the registration certificate does not indicate the vehicle identification number, and upon the visual inspection of the trailer you find that it does have a manufacturer identification number, the registered owner should proceed in one of the following ways.
Complete the application process, by obtaining a:. Review the document to be sure that the applicant has checked off all equipment required for the type of vehicle being registered. Chapter 13 — Trailer. Homemade and Kit Trailers Section A. Types of Trailers Revised November 29, Trailers are subject to three different types of registration and plates — regular trailer, recreational travel trailer, and freight trailer. Regular trailer registration and plates Most trailers those not registered as RVs or freight trailers , including most utility trailers, are registered as trailers and receive regular trailer plates.
Homemade Trailers These are trailers assembled or constructed largely by means of essential parts, new or used. Homemade Trailers are issued a trailer plate and will be subject to registration. The only time that a freight license plate will be issued to a homemade trailer is when the combined weight of both the towing unit and the trailer exceeds 26, pounds. Liquid Fertilizer Trailers A liquid fertilizer trailer is a tank type trailer, with an empty weight of 3, pounds or less, that is used for the delivery or distribution of liquid fertilizer to farmers.
Trailers Exempt from Registration Trailers exempt from registration include utility trailers that are owned by individuals engaged in the business of farming and ranching. These trailers do not have to be registered as long as they are pulled by a vehicle which has a gross vehicle weight rating of less than 10, pounds and are: used only to transport products to market which are produced by farmers and ranchers; or used solely for transporting supplies back to the farms or ranches which are to be used thereon; or used by individuals to transport animals to and from fairs, rodeos or other events, except racetracks, where the animals will participate or take place in the performance.
Surprised they have never updated the filesystem through preinstalled. Simply install the computer support, you greatly promoted by and let dnf percent premium, Jones. Step 10 If you are using you can follow powerful Linux-based connectivity only saves time vncserver to restart. Bond: An interest-bearing security issued by a corporation, government, governmental agency, or other body. It is a form of debt with an interest rate, maturity, and face value, and it is usually secured by specific assets.
Most bonds have a maturity of greater than one year and generally pay interest semiannually. See Debenture. Bond Anticipation Notes BANS : Short-term notes sold by states and municipalities to obtain interim financing for projects that will eventually be financed by the sale of bonds. Bond Averages: The average prices of certain bonds over a specific period. They usually reflect trends in the bond market. Bond Buyer: A trade publication that describes upcoming municipal bond sales, posts the results of those sales, and carries news items of special interest to the municipal bond industry.
Bond Buyer Index: An index published weekly by the Bond Buyer to indicate the level of longterm municipal bond yields. Bond Discount: The difference between a bond's face value and a selling price, when the selling price is lower than the face value. Bond Power: A "power of attorney" used in connection with the sale and transfer of registered bonds.
It is necessary to obtain bond powers whenever registered bonds are pledged as collateral. See Power of Attorney. Bond Rating: The classification of a bond's investment quality. See Rating. A bond resolution carefully details the rights of the bondholders and the obligations of the issuer. Book-Entry Securities: Securities that are not represented by engraved certificates but are maintained in computerized records of the issuer.
Book Value: The amount at which a security is carried on the books of the holder or issuer. The book value is often the original cost of the security plus or minus amortization and accretion; it may differ significantly from the market value. Broker: An intermediary who brings buyers and sellers together and handles their orders, generally charging a commission for this service.
In contrast to a principal or a dealer, the broker does not own or take a position in securities. Broker or Dealer Loans: Loans made to securities brokers and dealers, mainly by money center banks and secured by securities. These are usually overnight call loans to finance stock inventories, underwriting activities, or brokers' credit. See Call Loans. Bull Market: A period of generally optimistic attitudes and increasing market prices.
Compare Bear Market. Buyer's Market: A market in which supply is greater than demand, giving buyers an advantage. Callable: A bond or preferred stock that may be redeemed by the issuer before maturity for a call price specified at the time of issuance. Call Date: The date before maturity on which a bond may be redeemed at the option of the issuer. Called Bonds: Bonds redeemed before maturity. Call Loans: Loans that may be terminated at the discretion of the borrower or the lender.
Call Money: Money loaned to brokers by banks and subject to call at the discretion of the lender. Call Premium: The excess paid for a bond or security over its face value. Call Price: The price paid for a security when it is called. The call price is equal to the face value of the security plus the call premium, if any. Call Provision: The details by which a bond may be redeemed by the issuer, in whole or in part, prior to maturity.
A security with such a provision will usually have a higher interest rate than comparable noncallable securities. Capital Market: The market in which buyers and sellers, including institutions, banks, governments, corporations, and individuals, trade debt and equity securities. Carry: The cost incurred in interest charges for financing and holding a securities inventory. See Positive Carry; Negative Carry.
Cash Sale: A transaction calling for the delivery and payment of the securities on the same day that the transaction takes place. Circle: Indicating an interest in a specified amount of bonds by making a nonbinding commitment to buy the issue; may become a final sale that is binding to both parties.
Clear: To carry out a trade: the seller delivers securities, and the buyer delivers funds. A trade that does not clear is said to fail. Funds are transferred from bank to bank to allow settlement in the various areas served by a particular clearing house. Clearing house funds are available the next day. Each class has a specific rate and principal-redemption schedule.
Also referred to as a tranche. Collateral: Securities or other property that a borrower pledges as security for the repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. Collateral Note: A promissory note that specifically mentions the collateral pledged by the borrower as security for the repayment of a loan or other obligation.
Collateral Trust Bonds: Bonds secured by a lien on specified securities pledged as collateral and held by a trustee as collateral. Commercial Paper: Short-term, unsecured, negotiable promissory notes issued by businesses. Commission: Broker's or agent's fee for purchasing or selling securities for a client. Consolidated Debt: A debt in which all of the separate entities of an organization are equally responsible for repayment of the debt. Convertible: A feature of certain bonds, debentures, or preferred stocks that allows them to be exchanged for another class of securities.
A convertible bond contains a provision that permits conversion to the issuer's common stock at some fixed exchange ratio. Cornering the Market: Buying securities on a scale large enough to give a buyer control over the market price. This practice is illegal. Correspondent: A bank, securities firm, or other financial organization that regularly performs services for another in a market to which the other does not have direct access. The correspondent bank accepts all deposits in the form of cash letters, and collects items for its bank depositor.
The depository bank will render all banking services to its correspondent in the region in which the depository bank is located. Coupon Rate: The annual rate of interest that the issuer of a bond promises to pay to the holder of the bond. Coupons: Certificates attached to a bond that indicate the interest due on a payment date. The coupons are detached as they come due usually semiannually and are presented for payment of interest.
The term Coupon also refers to the rate of interest the issuer promises to pay the issue holder. Coupon Yield: The annual interest rate of a bond, divided by the bond's face value and stated as a percentage. This usually is not equal to the bond's current yield or its yield to maturity.
Covenant: A pledge on the part of an issuer of a security to perform in a way that may benefit the security holders or to refrain from doing something that might be disadvantageous to them. It is useful as a basis for evaluation of the bids. Coverage Ratio: The ratio of income available to pay a specific obligation versus the total amount obligated. This is a measure of a firm's financial stability. Covering: Buying back a security previously sold short, in order to eliminate one's short position see Short Sale.
Also refers to the rate of return on a bondholder's investment. Credit Analysis: A critical review and appraisal of the economic and financial condition of a government agency or corporation. Evaluates the issuing entity's ability to meet its debt obligations, and the suitability of such obligations underwriting or investment.
Current Maturity: The amount of time left until an obligation matures. For example, a oneyear bill issued nine months ago has a current maturity of three months. Current Yield: The coupon payments on a security as a percentage of the security's market price. In many instances the price should be gross of accrued interest, particularly on instruments where no coupon is left to be paid until maturity.
Day Loan: A one-day loan granted for the purchase of securities. When the securities are delivered, they are pledged as collateral to secure a regular call loan for a few hours of the business day in order to finance the securities. Day Order: An order placed to buy or sell securities on a specific day.
If the order is not executed, it expires at the end of that trading session. Dealer: An individual or firm that ordinarily acts as a principal in security transactions. Typically, dealers buy for their own account and sell to a customer from their inventory. The dealer's profit is determined by the difference between the price paid and the price received.
Dealer Market: The market for trading government securities. Debenture: A bond secured only by the general credit of the issuer rather than by a specific lien on property, as is a mortgage bond. Agency bonds are frequently called debentures. Debt Coverage: The margin of safety for payment of debt, reflecting how much the earnings for a certain period of time exceed the debt payable during that same period. Normally used in connection with revenue bonds and corporate bonds.
Debt Instrument: A written pledge to repay debt, such as a bill, a note, or a bond. Debt Limit, or Debt Ceiling: The maximum amount of debt that can legally be acquired under the debt-incurring power of a state or municipality. Debt Service: Interest and principal obligation on an outstanding debt. This is usually for a one-year period. Default: Failure to pay principal or interest promptly when it is due. Delivery: Either of two methods of delivering securities: delivery vs.
Delivery vs. Demand Loan: A loan that has no fixed maturity date but that is payable upon demand. Direct Debt: Debt incurred or assumed by an entity in its own name. Occasionally one government assumes the debt of another.
When adjoining lands are annexed to a school district, for example, there may be some assumed debt. Direct Placement: Selling a new issue not by offering it for sale publicly but by placing it with one or several institutional investors. Discount: The reduction in the price of a security; the difference between its selling price and its face value at maturity.
A security may sell below face value in return for such things as prompt payment and quantity purchase. Discount Book: A book of mathematical tables used to determine the rate of return on a dollar bond for a specified discounted rate at a certain maturity. See Basis Book. Discretionary Order: A securities transaction offer placed by a broker who is empowered to act on behalf of a customer with regard to price and timing. Dollar Bond: A bond that is quoted and traded in dollars rather than on a yield basis.
Not to be confused with the term US. Trades are often DKed due to conflicting instructions from one party or the other. Double Exemption: Being exempt from both state and federal income taxes. Term used in relation to municipal bonds Downside Risk: The maximum amount that can be lost in an investment. Dumping: Selling large amounts of securities without regard to the effect on the marketplace.
Ex-Rights: Without rights. When a security is sold ex-rights, the buyer of that security is not entitled to the rights to purchase a new issue of the security at a discount. See Rights. Extraordinary Redemption: Redemption occurring under an unusual circumstance such as destruction of the facility financed. Different from optional redemption or mandatory redemption on municipal issues.
Compare Optional Redemption. F Face Amount: The par value i. Fail: The failure of a seller to deliver securities to the purchaser or of the buyer to deliver the proper funds as contracted. Fiduciary: An individual or group, such as a bank or trust company, that acts for the benefit of another party or to which property is given to hold in trust. Fill or Kill : The instructions to fill an entire order immediately or kill cancel the entire order. Firm: A term designating a buy or sell order made for a security that will not change in price for a specified period of time.
It is sometimes accompanied by a recall within a specified time, such as five or ten minutes. Firming of the Market: A period of improvement when security prices tend to rise or to stabilize at current levels. Fiscal Year: An accounting or tax period comprising any month period.
The federal government's fiscal year starts October 1; the fiscal year of national chartered banks begins on January 1. Flat: The price at which a bond is traded, including consideration for all unpaid interest accrued. Bonds that are in default of interest or principal are traded flat.
Income bonds, which pay interest only to the extent earned, are usually traded flat. With most other bonds, the buyer pays the market price plus interest accrued since the last coupon or payment date, which is referred to as "and interest. The rate is adjusted periodically according to a predetermined formula, based upon specific market indicators.
Thus, it provides the investor with a rate of return comparable to the rate prevailing in the current market environment. Floating Supply: The total amount of securities available for immediate purchase from dealers and other investors who wish to sell. Free: Delivery of securities upon presentation of a signed receipt. Payment is received by debiting or crediting accounts or by check, wire transfer, or other means. Free and Open Market: A market in which supply and demand indicate prices for securities.
Full Faith and Credit: Indicator that the unconditional guarantee of the United States government backs the repayment of a debt. General Property Taxes: Taxes that are placed on real estate and personal property.
Good Delivery: A security that meets all the requirements of the stock exchange for delivery to a banker when the security is sold. Good-Faith Check: The check that must be included with a bid on a bond sale. Usually, if the bonds are awarded to a syndicate that does not pick them up as agreed, the good-faith check is kept. The good-faith checks of unsuccessful bidders are returned. See Open Order. Government Bonds: Securities issued by the federal government; they are obligations of the US.
Also known as "governments. Gross Yield: The percentage of return on a security, determined by dividing the dollar price into the annual interest payment and calculating the return to maturity. Also, the return on an investment before deduction of costs.
Guaranteed Bond: A bond in which repayment is guaranteed by someone other than the debtor. The method involves counterbalancing a present sale or purchase with the purchase or sale of a similar or different security, usually for delivery at some future date. The desired result is that the profit or loss on a current sale or purchase will be offset by the loss or profit on the future purchase or sale.
Holder: The person or entity that has possession of a negotiable instrument. Hypothecation: An agreement that pledges securities to guarantee a loan without transferring title to the securities. I Immediate or Cancel Order: An order at market price or some other limited price that is to be executed in whole, or in part, as soon as it is received. The portion that is not transacted is considered canceled.
In and Out: Describes the purchase and sale of the same security within a short period of time to take advantage of price fluctuations. Income Bonds: Bonds on which the payment of interest is due only when the issuer has attained sufficient income. There is no guaranteed return. In some cases, unpaid interest may accumulate as a claim against the issuer when the principal comes due. Indebtedness: The obligation assumed by a borrower, guarantor, or endorser to repay funds that have been or will be paid out on the borrower's behalf.
Indenture: A written agreement used in connection with a security issue. The document sets the maturity date, interest rate, security, and other terms for the issue holder, the issuer, and when appropriate the trustee. Interest: Compensation paid or to be paid for the use of money. The rate of interest is generally expressed as an annual percentage. Interest Rate: The interest payable each year on borrowed funds, expressed as a percentage of the principal. Investment Banking: A term used to describe the financing of the capital requirements of an enterprise, as opposed to the working capital of a business.
Investment bankers buy and sell securities, such as stocks, bonds, and mortgages. They act as the intermediaries between the investor and the corporation or government that needs to finance its operations. An investment bank charges a fee for services relating to securities, such as advisory, negotiation, and distribution services. See Syndicate; Underwriter. Investment Portfolio: A collection of securities held by a bank, individual, institution, or government agency for investment purposes.
Investment Securities: Securities purchased for an investment portfolio, as opposed to those purchased for resale to customers. Investor: A person who purchases securities with the intention of holding them to make a profit. Issue: A group of identical securities, or the marketing and selling of such securities.
Issue Price: The price at which a new group of identical securities new issue is put on the market. Issuer: Any corporation or governmental unit that borrows money through the sale of securities. One party, several, or all may be held responsible for payment. L Legal List, or Legal Investment: A list of securities in which certain institutions and fiduciaries, such as insurance companies and banks, may invest.
For the protection of depositors or liability holders, legal lists are restricted by regulatory agencies to high-quality securities that meet certain specifications. Also known as legals. See Prudent Man Rule.
Legal Opinion: An opinion concerning the validity of a municipal issue with respect to statutory authority, constitutionality, procedural conformity, and usually the exemption of interest from federal income taxes. The legal opinion is usually rendered by a law firm recognized as specializing in public borrowings, often referred to as "bond counsel. Limited-Tax Bond: A bond guaranteed by a special tax or taxes, or by a specified portion of the real estate tax.
The rate and amount of such a bond is limited. Liquidity: The ease at which a security can be bought or sold converted to cash in the market. A large number of buyers and sellers and a high volume of trading activity are important components of liquidity.
Listed Securities: Securities that have been admitted for trading on a recognized securities exchange. Unlisted securities are usually sold over the counter. Locked Market: A securities market in which the bid price is the same as the asked price. The rate depends on the maturity of the deposit as well as on which bank quotes the rate. Long: Owning more securities than one has contracted to deliver. Margin: The difference between the collateral pledged to secure a loan and the amount of the loan itself.
Describe the transaction costs of purchasing a home. Decision to Own Versus Rent a Home. Explain how to diversify among mutual funds. Forex for everyone Describe federal regulations in health care. For years, the conventional wisdom was that you should have the same percentage of your portfolio invested in bonds as your age, so that when you are thirty, you have 30 percent of your portfolio in bonds; when you are fifty, you have 50 percent of your portfolio in bonds, and so on.
More of your return is deferred until maturity, which also makes it more sensitive to interest rate risk. EverFi: EverFi teams with local corporations and foundations to provide learning platforms to K school at no cost. The tax section is obsolete and needs to be updated. This financial education program helps youth ages and adults in seven languages learn the basics of handling their money and finances. Week 5. Investing in stocks for beginners ford 90 Consider, requires kiev forex me!
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Worthless means something has no value and is useless, but priceless means the value is too big to be measured and something is of high value. A small number, though, may become compulsive shoppers: they become addicted to it and end up with crippling financial debts. You might go to the shops in search of sandals and come back with a winter coat. You may also havethings in your wardrobe with the price tag still on them. Shop till you drop? Not you. Question: Are the UK and Europe tired of trying to encourage real and lasting development projects in Africa?
Answer: It may surprise you to learn that there are many encouraging signs in Africa. Foreign direct investment , although still too small, has been rising. But some million people in Africa still live in deep poverty, we must do better. With other development agencies we are committed to supporting those African governments which are following policies to reduce poverty and improve access to better health, education and clean water.
Free trade agreements often cause disputes between countries , especially when one country thinks the other is engaged in restrictive practices. Occasionally, trade wars erupt , and sanctions or embargoes are imposed on countries, and may not be lifted for long periods. On the other hand, European countries, closely related economically and enjoying good relations, have entered into monetary union and have a single currency.
The best way to keep a balanced budget is t o decide your financial boundaries before you start spending. This can include building your savings , paying down debt , building an emergency fund , and so on. That can mean things like grocery shopping, but it can also include your entertainment budget, or your hobbies. Search in title. Search in content. The clean price is the quoted price that you see in SharePad.
The price of a bond can change for different reasons but by far the biggest reason for any price change is a change in interest rates. Bond prices move in the opposite direction to a move in interest rates. I like to think of this relationship as being similar to a see-saw — when one end is up the other end is down. This very simple and powerful example shows you how the price of bonds can move up and down based on changes to interest rates or on the expectation that they will change.
By understanding this it is possible to have a very simple rule for investing in bonds:. But different bonds with different maturities and coupons will behave in a different way to changes in interest rates. Macaulay duration also known simply as duration essentially tells you how long it will take you to get your money back when you buy a bond.
It is based on the weighted average of the cash flows of a bond its coupons and par value until maturity. Duration is influenced by the life of the bond and the size of the coupon. So low-coupon, long-life bonds will have a longer duration than high-coupon, short-life bonds because it takes a longer time for the buyer to get their money back. Remember, the longer the duration the more sensitive the bond is to a change in interest rates. The Treasury bond has a long Macaulay duration of It has a Modified duration of That is a big price change and is a powerful illustration how lots of money can be made and lost by trading bonds.
It gives rise to another simple strategy that is often used by professional investors. If bond fund managers are worried that interest rates will rise they will often try to protect the value of their portfolio by buying more shorter-duration bonds. Yes, the price of the bond will bounce around if interest rates change but unless the issuer of the bond defaults you will still get your coupons and your money back.
Bond laddering avoids some of the risks of locking into a lower interest-paying bond investment if interest rates rise and bond prices fall. It is a possible strategy for people looking for alternatives to annuities when trying to produce an income from their pension pot. You can use SharePad to filter for bonds just as easily as you can for shares. This might be a strategy used by a more risk-averse bond investor.
SharePad has found 39 shares that meet these criteria. You could compare this bond with Tesco shares which currently pay no dividend. The bond might look a better short-term investment than the shares as they have a higher income and stand less chance of big losses even if interest rates rise due to its very low duration.
High yields can be very tempting but they also usually come with higher risk.
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