entering 1099 OID on failing 10 yr zero coupon note

[Bp15]

In 2018, financial advisor got us into several series E MTN zero coupon notes that have only tanked in value each year so far (10 yr notes).  Each year there is a 1099-OID on our consolidated tax statement for these specific notes.  The 1099-OIDs only has a value in box 1, and this value has increased 3 fold in the last 3 years.  For 2024, this value alone is incurring several thousand dollars in taxes when entered as is, while the investment itself tanked further (down almost 35% since 2018).  We will surely take a loss at maturity.

Something is not adding up for me -  why are we paying thousands in taxes each year on this failing investment, while also expecting to lose on the investment at maturity?  What will happen to all the taxes we pay over 10 years at maturity?  Is box 1 supposed to be adjusted in any way?  

Thank you for your assistance!

[RobertB4444]

An original issue discount is the difference between the value that was originally purchased and the value at maturity.  For instance if you purchase a bond for $90 that will be worth $100 at maturity the OID is ten bucks.

Your case sounds super weird.  And out of our scope here.  I have no idea why an instrument that is worth less now than when you purchased it would generate an OID of that size.  You might want to speak to a professional in your area and have them review this investment.

@Bp15 

[Bp15]

Thank you.  When you say professional - are you referring to a financial advisor or tax advisor?  I did try to ask our financial advisor but was told to talk to a tax advisor.

[RobertB4444]

I was thinking attorney.  But an investment advisor who can explain the nature of this investment to you and why it seems to be showing such a huge increase in value that your taxes are going up every year while you simultaneously believe that it is decreasing in value would work too.

@Bp15