Entering an Original Issue Discount Form 1099-OID

To enter a 1099-OID:

Box 1 - Original issue discount

  1. Go to Screen 11, Interest Income.
  2. Scroll down to the Form 1099-INT section.
  3. Enter the reported income in Banks, Savings and Loans, Credit Unions, etc.
  4. Enter any adjustments in Original Issue Discount (OID), if the amount reported in Form 1099-OID, Box 1 is more or less than the actual amount of Original Issue Discount to be reported.
Note: If the amount of OID reported in box 1 of Form 1099-OID, is greater than the actual amount of OID, an entry here will print below the subtotal on Schedule B with the description "OID Adjustment" and will reduce the subtotal by this amount to arrive at total interest income.   If the amount in box 1 of Form 1099-OID is less than the actual amount of OID, a negative entry will increase the interest income reported.

Box 2 - Other Periodic Interest - The instructions for form 1099-OID state that if the obligation was held the entire year, the amount in box 2 should be reported as interest income on the tax return.
  1. Go to Screen 11, Interest Income.
  2. Scroll down to the Form 1099-INT section.
  3. Enter the amount in, Banks, savings & loans, credit unions, etc.,.

Box 3 - Early Withdrawal Penalty - Shows interest or principal forfeited if the taxpayer withdrew the money before the maturity date of the obligation, such as from a CD. This amount may be deducted  to figure your adjusted gross income on your income tax return.

  1. Go to Screen 11, Interest Income.
  2. Scroll down to the Form 1099-INT section.
  3. Enter the amount in Early Withdrawal Penalty under the Other subsection.

Box 4 - Federal Income Tax Withheld - Shows backup withholding. Generally, a payer must backup withhold at a 28% rate if the taxpayer did not furnish a taxpayer identification number (TIN) or did not furnish the correct TIN to the payer. See Form W-9, Request for Taxpayer Identification Number and Certification, for information on backup withholding. Include this amount on your income tax return as tax withheld.  .

  1. Go to Screen 11, Interest Income.
  2. Scroll down to the Form 1099-INT section.
  3. Enter the amount in Federal income tax withheld under the Tax Withheld subsection.

Box 7 - Description - Shows the identification number (CUSIP number) or description of the obligation. The description may include the stock exchange, issuer, coupon rate, and year of maturity.


Box 8 - Original issue discount on U.S. Treasury obligations - Shows OID on a U.S. Treasury obligation for the part of the year the taxpayer owned it. Report this amount as interest income on the federal income tax return, and see Pub. 1212 to figure any appropriate adjustments to this amount. This OID is exempt from state and local income taxes and is not included in box 1.

  1. Go to Screen 11, Interest Income.
  2. Enter the amount in U.S. Bonds, T-Bills (nontaxable to state).

Box 9 - Investment expenses - Any amount shown is the taxpayer's share of investment expenses of a single-class REMIC. If filing a Form 1040, the taxpayer may deduct these expenses on the "Other expenses" line of Schedule A (Form 1040) subject to the 2% limit. This amount is included in box 2.

  1. Go to Screen 25, Itemized Deductions.
  2. Scroll down to the Miscellaneous Deductions (Subject to 2% AGI limitation) section.
  3. Enter the amount in Investment Expense [A].

 

 

For additional information on entering information from Form 1099-OID please see the IRS instructions for Form 1099-OID.