accrued market discount on form 1099-B

[ramras_8]

I entered the Accrued market discount on the 1099-B worksheet (Form 8949) as an adjustment amount and entered D for the adjustment code. How come the market discount amount does not flow as interest income  on Schedule B?

[Just-Lisa-Now-]

its an adjustment on the sale of stock, why would it be interest?  Are you thinking of market discount on a bond?

[Michelle7]

Only the accrued market discount on LT transactions go to sch B.  ST does not since it is already taxed at ordinary rates.

[ramras_8]

It's not from sale of stock but from redemption of a US Treasury obligation and the gain or loss on  Form 1099-B is zero. Besides, the government instructions for Form 8949 says to report market discount as interest income on Schedule B. I found the answer to my question. If you  double click on any data field on the 1099-B worksheet, it opens capital gain (loss) adjustment worksheet and down below the page on Part IV that's is where you enter the amount of the interest income to go to Sch B. I was just wondering why you have to manually enter the amount. Why is it not automatically populating that field when you enter the adjustment and assign code D on the 1099-B worksheet?

[ramras_8]

I  don't think the distinction between LT and ST matters. All market discount should be reported as interest income on Sch B.