Collateralized Debt Obligation

Collateralized Debt Obligation means:
a debt instrument, other than a real estate mortgage investment conduit regular interest, that is secured by a pool of mortgages (or other evidence of debt) and that has principal payments that are subject to acceleration. CDOs, also called pay-through bonds, can be secured by a pool of mortgages, automobile loans, equipment leases, or credit card receivables.

A CDO is considered a debt instrument for tax purposes, and the income reporting, original issue discount, and market discount rules that apply to bonds and other debt instruments generally apply to CDOs.