Bubba buys a municipal bond at 102 and holds it ten years to maturity. For tax purposes, how is that premium treated?
A) recorded as a long-term capital loss
B) an ordinary loss taken as a deduction from taxable income
C) amortized over the life of the bond resulting in no loss at maturity
D) carried forward as a premium loss applied against profits realized on future municipal securities
Correct Answer:
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