first are they tax-exempt bonds or taxable bonds.
a taxpayer is required to amortize the premium of a tax-exempt bond so if held to maturity there is no gain or loss. report on box 13 of 1099-int. the amortization should have been reported on the 1099
for taxable bonds you have 2 options
1) amortize a portion of the premium each year report in box 11 see pub 550 page 32-33 for how you calculate amortization
2) don't amortize and take a capital loss when it matures
https://www.irs.gov/forms-pubs/about-publication-550
here's an example using effective interest rate
unamortized effective
balance at annual interest
beginning interest interest earned at
year of year rate payment effective rate amortiztion
1 $110,000.00 0.0807439 $10,000.00 $8,881.83 $1,118.17
2 $108,881.83 0.0807439 $10,000.00 $8,791.54 $1,208.46
3 $107,673.37 0.0807439 $10,000.00 $8,693.97 $1,306.03
4 $106,367.34 0.0807439 $10,000.00 $8,588.51 $1,411.49
5 $104,955.85 0.0807439 $10,000.00 $8,474.54 $1,525.46
6 $103,430.39 0.0807439 $10,000.00 $8,351.37 $1,648.63
7 $101,781.76 0.0807439 $10,000.00 $8,218.24 $1,781.76