Help with OID adjustment please!

[ryanf1475]

Hello!

I recently began investing with Prosper (peer-to-peer lending) and was given a 1099-OID, which I know nothing about. Now, H&R Block is asking me for an adjustment, as pictured below. How does this work? Any advice appreciated. -Ryan.

 

[Taxing Matters]

Hello!

I recently began investing with Prosper (peer-to-peer lending) and was given a 1099-OID, which I know nothing about. Now, H&R Block is asking me for an adjustment, as pictured below. How does this work? Any advice appreciated. -Ryan.

Unfortunately there isn't much I can tell you that is specific to your situation since I know nothing of the investment you had and I haven't seen the Form 1099-OID that you received. Also, the screen shot you posted is so small that I can't read it, though my guess is that it says "original issue discount adjustment (learn more)". The learn more link in the software should explain what kind of adjustment would go in that box. Note that it is not necessarily the case that there is any adjustment to be made. Learn more about taxation of original issue discount (OID) instruments in IRS Publication 1212.

 

[quincy]

From the screenshot:

Original issue discount $5994
Original issue discount adjustment $0 learn more

Original Issue Discount: The amount the face value of a bond is more than its issue price. You must report part of the discount on taxable bonds as taxable interest income. You’ll do this each year that you own the securities.

 

[ryanf1475]

Right, when I click "Learn More," the Help section opens up on the right--but I have no idea if this applies to peer-to-peer lending.

 

[ryanf1475]

Unfortunately there isn't much I can tell you that is specific to your situation since I know nothing of the investment you had and I haven't seen the Form 1099-OID that you received. Also, the screen shot you posted is so small that I can't read it, though my guess is that it says "original issue discount adjustment (learn more)". The learn more link in the software should explain what kind of adjustment would go in that box. Note that it is not necessarily the case that there is any adjustment to be made. Learn more about taxation of original issue discount (OID) instruments in IRS Publication 1212.

The 1099-OID that I received only has Box 1 filled in with the number seen in the screenshot. And my Prosper account is just set to automatically loan out money and collect the payments from borrowers. I don't do anything fancy. So just wondering if anyone knows whether I'm supposed to make any adjustments in that situation. Thanks!

 

[davew9128]

I would start by going to a tax professional who actually knows what an OID adjustment is...

 

[quincy]

The 1099-OID that I received only has Box 1 filled in with the number seen in the screenshot. And my Prosper account is just set to automatically loan out money and collect the payments from borrowers. I don't do anything fancy. So just wondering if anyone knows whether I'm supposed to make any adjustments in that situation. Thanks!

So, you were the one who added the “$0” in the space for OID adjustment?

I agree with davew9128 that you should seek out a professional in your area for assistance.

 

[ryanf1475]

So, you were the one who added the “$0” in the space for OID adjustment?

I agree with davew9128 that you should seek out a professional in your area for assistance.

yes.... the screenshot is from H&R Block where I'm filling in the numbers...

 

[LdiJ]

yes.... the screenshot is from H&R Block where I'm filling in the numbers...

I am going to agree with Dave and Quincy. Online software is fine for pretty basic, ordinary returns. When you start adding investments and things like that, things can go wonky if you do not clearly know what you are doing.

At a minimum, you need to read the publication that taxing matters suggested that you read.