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How to Calculate the Unamortized Bond Premium

By Motley Fool Staff – Updated Nov 7, 2025 at 8:52 PM

Key Points

  • Bonds bought above face value add cost paid as "unamortized bond premium."
  • Reduce premium annually to align bond's book value with redemption value at maturity.
  • Consult tax advisor on premium tax deductions to optimize investment's return.
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