DEFINITION of 'Installment Receipt'

A debt or equity issuance in which the purchaser does not pay the full value of the issue up front. In the purchase of an installment receipt, an initial payment is made to the issuer at the time the issue closes; the remaining balance must be paid in installments, usually within a two-year period . Although the purchaser has not paid the full value of the issue, he or she is still entitled to full voting rights and dividends.

BREAKING DOWN 'Installment Receipt'

This type of debt or equity financing is most attractive to issuers that are unable to get an attractive price for more traditional financing techniques, such as a traditional initial public offering (IPO).

Installment receipts often trade on an exchange, in which case, whoever purchases them assumes liability for any installments that may remain. This type of financing is mainly seen in Canada.

RELATED TERMS
  1. Installment Sale

    A method of sale that allows for partial deferral of any capital ...
  2. Installment Debt

    A loan that is repaid by the borrower in regular installments. ...
  3. IRS Publication 537

    A document published by the Internal Revenue Service (IRS) that ...
  4. Form 6252: Installment Sale Income

    A tax form distributed by the Internal Revenue Service (IRS) ...
  5. Receipt

    A written acknowledgment that something of value has been transferred ...
  6. Unstated Interest Paid

    The percentage of interest the U.S. Internal Revenue Service ...
Related Articles
  1. Personal Finance

    Explaining Equated Monthly Installments

    An equated monthly installment is a fixed payment a borrower makes to a lender on the same date of each month.
  2. Investing

    What's a Hire Purchase?

    Hire purchase is a term used in Great Britain to describe an installment plan payment arrangement.
  3. Investing

    Avoiding A Big Tax Bill On Real Estate Gains

    Installment sales allow sellers to defer taxes on real estate profits.
  4. Taxes

    Which Receipts Save Big Money at Tax Time

    Don't wait to April 13th to set up a smart receipt-filing system. These 7 categories could save you some significant money.
  5. Taxes

    Form 9465: Don't Pay Your Back Taxes Without It

    This form can lighten your tax load if you owe Uncle Sam.
  6. Insurance

    Hiring a Contractor vs. DIY: Cost – Benefits

    When you want to change something about your home, the first question to ask yourself is whether it’s more cost-effective to DIY or hire a professional.
  7. Investing

    Do You Need A Rent Receipt?

    Landlords don't always bother to send receipts to renters. But there are important reasons renters should insist on getting proof they paid their rent.
  8. Taxes

    Can't Pay Your Taxes? What to Do Now

    Not enough cash on hand for your April tax bill? No need to panic. Here's what to do.
  9. Investing

    Solar Wars: Solar City vs. Verengo Solar vs. Sungevity

    Read about three important players in the growing solar-energy services market, and learn more about their business operations and market positions.
  10. Personal Finance

    Will Installment Loans Be the New Payday Loans?

    Payday lenders are leaning toward installment loans as a result of proposed federal regulations. But is this what's best for consumers?
RELATED FAQS
  1. How do small firms record installment sales?

    Read up on what an installment sale is, how to account for it and the benefits a small business may receive by using the ... Read Answer >>
  2. What are the pros and cons of getting installment credit to pay off your revolving ...

    Learn how installment credit can be used to pay off revolving debt as well as the advantages and disadvantages for each type ... Read Answer >>
  3. What are the differences between installment sales and credit sales?

    Determine the differences between credit sales and installment sales, which businesses often offer their customers for deferred ... Read Answer >>
  4. When do you use installment sales method vs. the cost recovery method?

    Take a deeper look at the installment sales method and the cost recovery method of recognizing business sales revenue and ... Read Answer >>
  5. What are the differences between revolving credit and installment credit?

    Discover how to distinguish between installment credit loans and revolving credit loans, and learn how they affect your credit ... Read Answer >>
Hot Definitions
  1. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  2. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  3. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  4. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  5. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  6. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
Trading Center