Market Discount on 1099-B

Technical topics regarding tax preparation.
#1
TrueTax  
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In the case of a tax exempt bond with an accrued market discount, is the accrued market discount reported on form 1099-B, box 1f already adjusted to remove the effect of the tax exempt OID? The 1099-B instructions do not give any guidance on how this figure is calculated.
 

#2
Nilodop  
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Pennsylvania
Box 1f. Shows the amount of accrued market discount. For details on market discount, see Schedule D (Form 1040) instructions, Instructions for Form 8949, and Pub. 550. If box 5 is checked, box 1f may be blank.
 

#3
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Each year any tax-exempt OID should have been reported as an information item on the consolidated 1099, and any market discount on munis listed out in the 1099-INT section (column 10). The OID would have been creating basis adjustments but should not be part of the tally of market discount listed on the 1099-B. I believe an exception would be if the muni had taxable OID, in which case it would be on 1099-OID. It might help to look at the entire 1099 to see what appears in the different sections.
 


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