You don't have to amortize. You can choose to amortize or not but whatever you choose you to have to stick with.
BUT I agree that this information is incorrect. Buying bonds at a premium or discount is considered "interest". The buy price is high because you will get more interest from the "old" bond than from a new bond. Therefore the premium is considered prepaid interest, not a capital premium.
Same with the discount in reverse. The price is down because you will get less interest while you hold it until maturity than you would on a new bond. Therefore you pay less for the buy to make up for the lack of interest. It's considered interest instead of cap gains.
Amortizing it reflects the annual interest you would have gotten if you bought a new bond at a higher price to begin with. But the IRS allows you to wait and realize all the interest when the bond matures if you like.
This isn't how Intuit's tax program is set up though. The programs do allow you to amortize correctly but you have to manually enter interest if you realize the interest at maturity.
