When you purchase a bond or note at a discount, you'll get Form 1099-OID (Original Issue Discount). The discount is taxable interest over the life of the bond, which gets reported every year you hold the bond, even if you don't actually receive any interest.
Here's how to enter your 1099-OID in TurboTax:
- Inside TurboTax, open or continue your return and then search for this exact phrase (we recommend you copy/paste from here): 1099-oid original issue discount
- Select the Jump to link at the top of your search results.
- On the Miscellaneous Investment Income screen, check the first box for Form 1099-OID and Continue.
- Answer Yes on the next screen, and continue to follow the onscreen instructions to import or manually enter your 1099-OID.
- If you land on the Form 1099-OID Summary screen, select Add Another Payer, and then follow the instructions to import or manually enter.
To remove an unwanted 1099-OID, follow Steps 1-3. This will bring you to the Form 1099-OID Summary screen where you can select Delete next to the unwanted 1099-OID.