Information about Form 1099-OID

Select a link below to go directly to a topic or read through the document to learn about Form 1099-OID.

• What is Form 1099-OID?
• How do I Enter Form 1099-OID?

You are issued a Form 1099-OID when you have purchased a bond or note for an amount that is less than face value. An OID (Original Issue Discount) is the excess of a bond or note's stated redemption price over its issue price. The stated redemption price is usually the face value of the bond or note (say $10,000). The issue price is generally the amount at which the bond or note was first sold by the issuer (say $9,500).

The profit you make on the purchase ($500 in our example) is the OID and is taxable interest income for you over the life of the bond. You must include a part of the OID as interest income each year you hold the bond - even if you don't actually receive any interest until the bond matures. You'll be issued a Form 1099-OID to document your OID interest.

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Here's how to get to the 1099-OID screens in TurboTax Online:

1. Select the Tools button in the upper right-hand portion of the screen. 
2. Select Topic Search. 
3. When the window opens, type "1099-oid" into the box, select the item that best describes the 1099-OID that you received, and then select GO.
4. Follow the on-screen instructions to enter the information from your 1099-OID.

Here's how to get to the 1099-OID screens in TurboTax desktop or CD/download version:

1. Enter your cursor into the search box in the upper right-hand portion of the screen. 
2. Type "1099-OID" into the box, select the item that best describes the 1099-OID that you received. 
3. Follow the on-screen instructions to enter the information from your 1099-OID.

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