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ok I see where the confusion may be - the 1099-B is showing a cap gain but that's the gain before the adjustment and not the 'net' gain that gets reported; entering the AMD adjustment will bring that gain down to zero on your Form 8949/Schedule D and it won't match the 1099-B gain figure and the difference will be on Schedule B.  See notes from Form 8949 below.

 

Different tax software seem to treat this differently, in TT case it automates transferring the AMD over to the Schedule B, sounds like this other software makes you do the Schedule B manually (but may handle state filing better).  The end result in both software should be a gain/loss of zero and the AMD is taxed as ordinary income not a cap gain.  I don't think you will be overpaying tax on this (unfortunately).

 

For more info on this topic, see Publication 550 from IRS comments on "market discount bond", p77 etc

https://www.irs.gov/pub/irs-pdf/p550.pdf

 

Report the sale or trade of a market discount bond in
Form 8949, Part I or Part II, whichever is appropriate. Use
the table How To Complete Form 8949, Columns (f) and
(g) in the Instructions for Form 8949 to help you figure the
amounts to report for a sale or trade of a market discount
bond. Also report the amount of accrued market discount
in column (g) as interest income on Schedule B (Form
1040), line 1, and identify it as “Accrued Market Discount.”

 

and in Form 8949 this table which TT takes care of based on your 1099-B:

https://www.irs.gov/instructions/i8949#en_US_2022_publink1000114436

 

Form 8949 AMD.png

 

 

 

 

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