Iowa Code 637.412 – Obligation to pay money
Current as of: 2024 | Check for updates
|
Other versions
Terms Used In Iowa Code 637.412
- Amortization: Paying off a loan by regular installments.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Trustee: A person or institution holding and administering property in trust.
- year: means twelve consecutive months. See Iowa Code 4.1
637.412 Obligation to pay money.
1. An amount received as interest, whether determined at a fixed, variable, or floating rate, on an obligation to pay money to the trustee, including an amount received as consideration for prepaying principal, must be allocated to income without any provision for amortization of premium.
2. An amount received from the sale, redemption, or other disposition of an obligation to pay money to the trustee more than one year after it is purchased or acquired by the trustee, including an obligation whose purchase price or value when it is acquired is less than its value at maturity, must be allocated to principal. If the obligation matures within one year after it is purchased or acquired by the trustee, an amount received in excess of its purchase price or its value when acquired by the trust must be allocated to income.
3. This section does not apply to obligations to which sections 637.421 through 637.424,
637.426, and 637.427 apply.
99 Acts, ch 124, §14
1. An amount received as interest, whether determined at a fixed, variable, or floating rate, on an obligation to pay money to the trustee, including an amount received as consideration for prepaying principal, must be allocated to income without any provision for amortization of premium.
2. An amount received from the sale, redemption, or other disposition of an obligation to pay money to the trustee more than one year after it is purchased or acquired by the trustee, including an obligation whose purchase price or value when it is acquired is less than its value at maturity, must be allocated to principal. If the obligation matures within one year after it is purchased or acquired by the trustee, an amount received in excess of its purchase price or its value when acquired by the trust must be allocated to income.
3. This section does not apply to obligations to which sections 637.421 through 637.424,
637.426, and 637.427 apply.
99 Acts, ch 124, §14