Fixed Income Elections
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Per IRS regulations, Scottrade is required to report cost basis on select debt instruments purchased on or after January 1, 2014. Use this form to change
certain elections which will affect how Scottrade calculates certain accruals on your debt instruments to match elections that you have made or intend to
make, with the IRS. These elections only change how Scottrade calculates and reports the relevant fixed income accruals. You must still make the
relevant elections directly with the IRS.
Account Information
Name
Scottrade Account Number
Throughout the Life of the Bond
1. Would you like to Amortize Bond Premium for all of your bond holdings?
Yes
No
IRS default option is “Yes”
Amortizable Bond Premium: A bond premium is the excess of the bond's adjusted basis over its issue price. The cost basis and
reportable income for taxable bond are reduced by the amortized premium each year. Tax-Free bond premiums do not provide a similar
deduction. The election to amortize a bond premium applies to all taxable debt instruments held by a taxpayer during the taxable year the
election is effective and thereafter.
2. If applicable, would you like to include the Market Discount
as it accrues for all of your bond holdings in your account?
Yes
IRS default option is "No." The default option will be to recognize
market discount at the time of sale, redemption or maturity.
No
Accrued Market Discount: The Accrued Market Discount pertains to a bond purchased in the secondary market at a price that is less
than the original issue price plus the accreted original issue discount (OID), if any. A market discount is taxed as ordinary income at the
time the bond is sold or redeemed. For instruments acquired during the years in which the election is in effect, cost basis and reportable
income are increased by the accrued market discount. Should you decide to sell the bond prior to maturity, your capital gain/loss would be
the difference between the sales proceeds and your adjusted basis.
3. If you answered 'Yes' to 2, would you like to calculate the
Market Discount using the straight-line method?
Yes
No
IRS default option is “No”
If your answer is 'Yes,' please specify the instrument details in the table below for this option. Please use additional forms if you run out of space.
Straight-Line Method: Treat the market discount as accruing in equal daily installments during the period you hold the bond. If you
choose to use this method for any bond, you cannot change your choice for that bond. This is an irrevocable election for the life of the
bond. For instruments specified below that are acquired during the years in which this election is in effect, market discount is accrued via
straight line rather than the constant-yield method. This election applies to all debt instruments with the same CUSIP number acquired by
a taxpayer during the taxable year the election is effective and thereafter. The election must be made for the earliest taxable year for
which you are required to determine accrued market discount.
Security Name
*CC1705*
CC1705-1/16
X
Authorized Individual's Signature
Symbol
Date
CUSIP
X
Authorized Individual's Signature
Scottrade, Inc. - Member FINRA and SIPC
Date