Market Discount
Response to the following problem:
On January 1, 2014, Dolly pays $9,380 for corporate bonds. The bonds were originally issued on January 1, 2009 for $9,330 and have a $10,000 face value. They mature on January 1, 2034. The bond's amortized carrying value (ACV) on January 1, 2014 was $9,450. What portion of the $620 difference between the $9,380 Dolly paid for the bonds and their $10,000 face value is OID?
What portion is market discount?
Discuss how Dolly treats these amounts on her tax return.