Taxation of Structured Debt in a Low-Rate Environment

14 Pages Posted: 18 Apr 2012

See all articles by Omri Y. Marian

Omri Y. Marian

University of California, Irvine School of Law

Andrew D. Moin

affiliation not provided to SSRN

Date Written: April 16, 2012

Abstract

Low market rates call for special types of debt instruments. This report discusses the tax questions presented by several of those instruments, including fixed-to-floating rate instruments, range accrual debt instruments, and callable step-up instruments. The authors note several ambiguities in the regulations regarding variable-rate and contingent payment debt instruments and call for clarification. They also explore some counterintuitive results of the technical operation of the regulations and argue that a possible explanation may be that the regulations were drafted during times of different market characteristics.

Keywords: Taxation of Financial Instruments, Taxation of Structured Debt, Original Issue Discount

JEL Classification: H25, K34

Suggested Citation

Marian, Omri Y. and Moin, Andrew D., Taxation of Structured Debt in a Low-Rate Environment (April 16, 2012). 135 Tax Notes 323 (2012), Available at SSRN: https://ssrn.com/abstract=2041312

Omri Y. Marian (Contact Author)

University of California, Irvine School of Law ( email )

401 E. Peltason Dr.
Ste. 1000
Irvine, CA 92697-1000
United States

Andrew D. Moin

affiliation not provided to SSRN

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