State tax filing

@sweetpeel this memo doesn't really address AMD explicitly, as "gain on sale" is not necessarily the same as AMD.

 

If you sell a discounted bond prior to maturity you will have an AMD accrual thru to sale date (calculated by the brokerage), and a gain/loss which may be more or less than the amount of AMD depending on the market etc.  The lesser of these two is adjusted down on the 1099-B (col g on Form 8949) and transferred to your Schedule B.  If you had a gain in excess of AMD that excess is taxed as a gain on your Federal taxes.  If you hold to maturity, your gain on sale will equal the AMD and there is no gain on Schedule D.


Not a CPA myself so this is just my understanding, but I would be cautious interpreting these memos based on the various nuances and seek out a CPA expert in your state code if in doubt about the taxability.

 

And yes TT behaves correctly on Fed returns in terms of handling the 1099-B AMD and Gain/Loss, and Schedule B/D outcome; but the inability for state exemption is debatable state by state.

 

(Personally I've stopped buying discounted T-Notes to be done with this topic in 2025).