ABP ADJUSTMENT

[Yianni52]

Where is the data source for the ABP adjustment that shows up on schedule B?

I have input all my info properly and do can not find how turbo tax computes this adjustment nor can I find a data source.

Thanks

[Anonymous_ · Accepted solution]

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@Yianni52 wrote:

Where is the data source for the ABP adjustment that shows up on schedule B?

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Lines 11 and 12 of your 1099-INT.

[JohnB5677]

"ABP" is an amortized bond premium. This means you purchased a bond at a certain price above par. For example, you paid $1870 for an $1800 bond. 

If you had a positive entry (>$0) on Line 11 of your 1099-INT, you would have an ABP interest adjustment. 

To manually post a 1099-INT

1. Select Federal
2. Wages & Income 
3. Scroll to Investments & Savings and 
4. select Show More,
5. Start or Revisit next to Interest on 1099-INT - Okay! 
6. Time to kick off your investments! 
7. Yes, on the screen Did you receive any interest income? then Continue.
   • If you see the screen Your investments & savings or Here's your 1099-INT info, select. 
   • Add investments or add another 1099-INT, then Continue.
8. Choose how you'd like to enter your 1099-DIV:
   • If you'd rather manually enter your form, select. 
     • Change how I enter my form, select. 
     • 1099-INT, then 
     • Type it in myself on the following screen.
9. Follow the on-screen instructions to enter the info from your 1099-INT.
10. When you reach the screen Here's your 1099-DIV info, the form you just entered should be listed.

Check the box My form has info in other boxes.

Post the information to Box 11 and [Continue]

The screen will show Do any of these uncommon situations apply?

Select I need to adjust the interest reported on my form.

Then enter your adjustment and select the reason from the drop-down menu.

If this does not completely answer your question, please contact us again and provide some additional details.

[Yianni52]

I have entered the info correctly from lines 11 and 12...there must be more to it than just that because the end result is a number that is not the total of 11 and 12

[Yianni52]

Thank you

The sum of box 11 and 12 from my 1099 is $593.37...yet the entry on schedule B for ABP is -$3.111.00.

Does OID come into play here?

What about ABP (box 11 and 12) from prior years?

Somewhere TTax must have a data source that computes the number they have entered on ScheduleB

Thank you again

[Anonymous_]

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@Yianni52 wrote:

I have entered the info correctly from lines 11 and 12...there must be more to it than just that because the end result is a number that is not the total of 11 and 12

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Do you have a 1099-OID, for example? It can come from other sources (e.g., a K-1) but the 1099-INT is the most common.

[ABPoid]

<*sigh*> Yea... this makes no sense to me either. It's like magic... and probably wrong.

1099-INT
Box 10: 
Box 12: 244.86

Box 13: 11,456

1099-OID
Box 6: 2244.21

Schedule B

ABP Adjustment: -1319.67

The numbers just don't add.

I should also note that I had to adjust the INT Box 12 to reduce it to match INT Box 3. TT is not handling Treasury TIP inflation adjustments (OID Box 😎 correctly. I moved excess Treasury bond premium to line 16 of Schedule A as directed.

[ABPoid]

OK... by tweaking the numbers by $1, I could see how each field affected the result.

ABP adjustment is (1099-INT Box 12) + ((1099-OID Box 6) * 1099-OID Box 8)/(1099-OID Box 8 + 1099-OID Box 11)

1099-OID Box 10 could also be in the equation, but mine is empty.

Basically, TurboTax is adding the Treasury bond premium to the OID acquisition premium X the % of taxable OID income to total OID income. I believe it's doing this since1099-OID Box 6 could contain acquisition premium of both taxable and non-taxable bonds.

The solution is to split the OID into 2 copies, one for taxable and one for non-taxable income. (This is the same problem/solution when adjusting for accrued interest when the 1099-INT contains both kinds of income.)