TurboTax FAQ
TurboTax FAQ
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What is Form 1099-OID, Original Issue Discount

What is Form 1099-OID?

You are issued a Form 1099-OID when you purchase a bond or note for an amount that is less than face value. An OID (Original Issue Discount) is the excess of a bond or note's stated redemption price over its issue price.

The stated redemption price is usually the face value of the bond or note (say $10,000). The issue price is generally the amount at which the bond or note was first sold by the issuer (say $9,500).

The profit you make on the purchase ($500 in our example) is the OID and is taxable interest income for you over the life of the bond. You must include a part of the OID as interest income each year you hold the bond - even if you don't actually receive any interest until the bond matures. You'll be issued a Form 1099-OID to document your OID interest.

Entering Form 1099-OID into TurboTax Desktop

Follow these steps to enter 1099-OID into TurboTax Desktop:

  1. Select Federal Taxes
    (Personal in the Home & Business edition).
  2. Select  Wages & Income, and in the new screen, click I'll choose what I work on.
  3. Under the Interest and Dividends group,
    • Click on the Start/Update button next to the 1099-OID, Foreign Accounts topic.
  4. Follow the prompts to enter your form.

After you have entered your first 1099-OID, you can add another form by clicking on the Add Another Payer button.

Entering Form 1099-OID into TurboTax Online

Follow these steps to enter 1099-OID in TurboTax Online:

  1. Select Federal Taxes
    (Personal in the Home & Business edition).
  2. Select Wages & Income, and in the new screen, click Jump to full list.
  3. Under the Interest and Dividends group,
    • Click on Show more next to Interest and Dividends, then click Start next to the 1099-OID, Foreign Accounts topic.
  4. Follow the prompts to enter your form.

After you have entered your first 1099-OID, you can add another form by clicking on the Add Another Payer button.


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