Original Issue Discount (OID)
The discount from par value at the time that a bond or other debt instrument is issued. It is the difference between the stated redemption price at maturity and the issue price. Investopedia Says:
An original issue discount bond is a bond issued at a price below par. The most extreme example of an OID is a zero-coupon bond. OID is considered to be a form of interest, so tax issues can get a bit complicated. Related Terms:
Bond
Par Value
Zero-Coupon Bond |