DEFINITION of 'Treasury Receipt'

A zero-coupon bond that doesn't pay interest at regular intervals between the date of issue and maturity, but instead accrues the interest and pays it with the principal at maturity. Treasury receipts are sold by an intermediary, such as a brokerage firm, that issues a receipt to the purchaser representing the underlying treasury securities.

BREAKING DOWN 'Treasury Receipt'

Treasury receipts have many different acronyms, including: STRIPS (Separate Trading of Registered Interest and Principal Securities), CATS (Certificates of Accrual on Treasury Securities), TIGRs (Treasury Investment Growth Receipts) and COUGRs (Certificate of Government Receipts). Generally, the receipts were created when a brokerage house would separate the coupon from the principal of a Treasury bond or certain mortgage-backed security bonds, and repackage them so that the principal and coupon were paid at maturity, a process that was permitted by the 1986 Tax Act. Now, the Treasury Department can issue its own zero-coupon bonds, lessening the appeal of the brokerage receipts.

RELATED TERMS
  1. Receipt

    A written acknowledgment that something of value has been transferred ...
  2. Custodial Receipt

    A receipt representing a security held by a custodian or transfer ...
  3. Gross Receipts

    A tax term relating to the total business revenue from services ...
  4. Certificates Of Accrual On Treasury ...

    Issued by the U.S. Treasury and stripped by a financial intermediary, ...
  5. Long Bond

    The 30-year U.S. Treasury Bond. The long bond is so called because ...
  6. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with ...
Related Articles
  1. 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.
  2. Investing

    Introduction to Treasury Securities

    Purchasing bonds that are backed by the full faith and credit of the U.S. government can provide steady guaranteed income and peace of mind. Knowing the characteristics of each type of treasury ...
  3. Investing

    The Importance Of U.S. Treasury Rates

    U.S. Treasury bond interest rates affect more than just bondholders! It impacts the day to day lives of all consumers.
  4. Investing

    Buy Treasuries Directly From The Fed

    If you want government securities, go straight to the source. We'll show you how.
  5. Investing

    All About Zero Coupon Bonds

    Zero-coupon bonds are bonds that do not make any interest payments (which investment professionals often refer to as the "coupon") until maturity. For investors, this means that if you make an ...
  6. Investing

    Long-Term Treasury Bond ETFs Are Attracting Assets in 2016 (TLT, TLH)

    Discover five exchange-traded funds that invest in U.S. Treasury long-term bonds and experienced large year-to-date capital inflows as of March 4, 2016.
  7. Investing

    IEI: iShares 3-7 Year Treasury Bond ETF

    Take a closer look at the iShares 3-7 Year Treasury Bond ETF, which is a BlackRock issue focused on intermediate maturity government bonds.
  8. Investing

    What is Treasury Stock?

    Treasury stock is a company’s own stock that it holds in its treasury for later use.
  9. 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.
RELATED FAQS
  1. How does an investor make money on a zero coupon bond?

    Learn about investing in zero-coupon bonds, exactly how they work as an investment vehicle, and their advantages and disadvantages ... Read Answer >>
  2. What is the difference between the Daily Treasury Long-Term Rates and the Daily Treasury ...

    Find out more about the daily Treasury long-term rates, daily Treasury yield curve rates and the difference between these ... Read Answer >>
  3. What is the difference between a zero-coupon bond and a regular bond?

    The difference between a zero-coupon bond and a regular bond is that a zero-coupon bond does not pay coupons, or interest ... Read Answer >>
  4. How is the interest rate on a treasury bond determined?

    Explore the difference between interest rates and bond coupons, what determines current yield on debt instruments, and why ... Read Answer >>
Hot Definitions
  1. Preferred Stock

    A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock. Preferred shares ...
  2. Net Profit Margin

    Net Margin is the ratio of net profits to revenues for a company or business segment - typically expressed as a percentage ...
  3. Gross Margin

    A company's total sales revenue minus its cost of goods sold, divided by the total sales revenue, expressed as a percentage. ...
  4. Current Ratio

    The current ratio is a liquidity ratio measuring a company's ability to pay short-term and long-term obligations, also known ...
  5. SEC Form 13F

    A filing with the Securities and Exchange Commission (SEC), also known as the Information Required of Institutional Investment ...
  6. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
Trading Center