Determination of amount of original issue discount

For purposes of this subpart— The term “original issue discount” means the excess (if any) of— The term “stated redemption price at maturity” means the amount fixed by the last modification of the purchase agreement and includes interest and other amounts payable at that time (other than any interest based on a fixed rate, and payable unconditionally at fixed periodic intervals of 1 year or less during the entire term of the debt instrument). If the original issue discount determined under paragraph (1) is less than— For purposes of this subpart— In the case of any issue of debt instruments— In the case of any issue of debt instruments not issued for property and not publicly offered, the issue price of each such instrument is the price paid by the first buyer of such debt instrument. In the case of a debt instrument which is issued for property and which— Except in any case— In applying this subsection, the term “property” includes services and the right to use property, but such term does not include money. For purposes of subsection (b)— The terms “initial offering price” and “price paid by the first buyer” include the aggregate payments made by the purchaser under the purchase agreement, including modifications thereof. In the case of any debt instrument and an option, security, or other property issued together as an investment unit—