Treatment of X in 1997 Sample Clauses

Treatment of X in 1997. For the accrual period ending on December 15, 1997, r is .0025 (.03/12), inf1 is .0075, and the product of r and inf1 is .00001875. Under paragraph (e)(3) of this section, the amount of OID allocable to the accrual period ending on December 15, 1997, is $916. This amount is determined by multi- plying the issue price of the debt instrument ($91,403) by .01001875 (the sum of r, inf1, and the product of r and inf1). The adjusted issue price of the debt instrument on December 15, 1997, is $92,319 ($91,403+$916). For the accrual period ending on January 15, 1998, r is .0025 (.03/12), inf2 is .0031, and the product of r and inf2 is .00000775. Under paragraph (e)(3) of this section, the amount of OID allocable to the accrual period ending on January 15, 1998, is $518. This amount is determined by multi- plying the adjusted issue price of the debt in- strument ($92,319) by .00560775 (the sum of r, inf2, and the product of r and inf2). Because the accrual period ending on January 15, 1998, spans two taxable years, only $259 of this amount ($518/30 days×15 days) is allo- cable to 1997. Therefore, X includes $1,175 of OID in income for 1997 ($916+$259).
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Related to Treatment of X in 1997

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