I purchased a market-linked CD issued by Wells Fargo several years ago. The investment has paid roughly $750 each report, reported as accrued OID interest on my 1099-OID. For the first time this year (i.e., 2016 tax year), a shortfall was also reported on my 1099. The shortfall was reported as $416. Indeed the actual payment I received from this security was equal to the difference between the period OID accrual ($750) and the shortfall, that is, the payment was around $333.
Should I simply enter a negative adjustment in TurboTax for my OID income equal to the reported shortfall amount, thereby reducing my OID income by the shortfall amount? From what I've researched I think that is the correct thing to do, but the governing IRS publication (1212) is not easy to follow.
