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Negative Interest and Negative Rebates: The World Turned Upside Down  

Author:  James L. Saeli.; Richard Lavoie.; Mark Howe.

Source: Volume 32, Number 04, Summer 2015 , pp.3-23(21)

Journal of Taxation of Investments

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As the global economy recovers from the economic recession that began in 2008, instances of negative yields on debt instruments and “negative” payments on cross-border financial instruments have become more common. The Internal Revenue Service and Treasury Department have given some clues as to the proper treatment of negative yield and negative rebates, but no definitive guidance has been issued.

Keywords: negative interest, negative yield, negative rebate, original issue discount, OID, negative OID, Treasury Inflation Protected Securities, TIPS

Affiliations:  1: Cadwalader, Wickersham & Taft LLP; 2: University of Akron School of Law; 3: Cadwalader, Wickersham & Taft LLP.

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