Retirement of Securities Law and Legal Definition

Retirement of securities is the removal of an asset from securities markets because its maturity date has been reached. It is the calling and redemption of a bond by payment. A repurchase of its own stock by a corporation and the cancellation of the repurchased shares and destroying all rights adhering to them is retirement of securities.

Under the Revenue Act, retirement of securities is not used in an artificial sense. In common understanding and according to the dictionaries, the word retirement is broader in scope than the word redemption. [McClain v. Commissioner, 311 U.S. 527, 530 (U.S. 1941)].