I received 1099-B form for TIPS that matured, but it does not show any earnings, how do I reflect this in 2024 Tax?

[Tirupati]

What is the name of your state? New York


Good Morning,

I have several Treasury Inflation Protected Securities (TIPS) with US Treasury.

In past years when they matured, I never received 1099-B.

For 2024, I received 1099-B for a 10-Year TIPS that matured in Jan 2024.

While I held the TIPS for 10 Years I:

1. paid tax on the Interest (based on what was shown in 1099-INT)
2. paid tax on the Original Issue Discount (OID) (based on what was shown in 1099-OID)

The form does not show anything earned on the TIPS.

Please guide.

a. I don't understand what I have to pay tax on considering I already paid taxes on the interest and the OID. Whatever Interest I have to pay will appear in 1099-INT

b. And in the 1099-OID, this was a Negative OID from 12-31-2023 to 1-16-2024. I would think that in Schedule B, I can discount this negative OID amount.

Below are the fields of 1099-B and what was filled:
Applicable Check Box on form 8949: E

CUSIP Number: [the CUSIP Number]

Payment Date: 01-16-2024

Transaction Confirm # : [the Transaction Confirm #]

Description of Security (Ref Box 1a): 10-Year TIPS

Date Acquired (Ref Box 1b): this was left blank

Proceeds (Ref Box 1d): the inflation-adjusted value of the TIPS I invested

Cost or Other Basis (Ref Box 1a): $.00

Accrued Marked Discount (Ref Box 11): $.00

CUSIP: [the CUSIP Number]

Transaction Confirm #: [the Transaction Confirm #]

Type of Gain or Loss (Ref Box 2): this was left blank

If Checked, Noncovered Security (Ref. Box 5): This is checked

Reported to IRS (Ref Box 6): Gross Proceeds

Check if basis reported to IRS (Ref. Box 12): this was left blank

 

[LdiJ]

What is the name of your state? New York


Good Morning,

I have several Treasury Inflation Protected Securities (TIPS) with US Treasury.

In past years when they matured, I never received 1099-B.

For 2024, I received 1099-B for a 10-Year TIPS that matured in Jan 2024.

While I held the TIPS for 10 Years I:

1. paid tax on the Interest (based on what was shown in 1099-INT)
2. paid tax on the Original Issue Discount (OID) (based on what was shown in 1099-OID)

The form does not show anything earned on the TIPS.

Please guide.

a. I don't understand what I have to pay tax on considering I already paid taxes on the interest and the OID. Whatever Interest I have to pay will appear in 1099-INT

b. And in the 1099-OID, this was a Negative OID from 12-31-2023 to 1-16-2024. I would think that in Schedule B, I can discount this negative OID amount.

Below are the fields of 1099-B and what was filled:
Applicable Check Box on form 8949: E

CUSIP Number: [the CUSIP Number]

Payment Date: 01-16-2024

Transaction Confirm # : [the Transaction Confirm #]

Description of Security (Ref Box 1a): 10-Year TIPS

Date Acquired (Ref Box 1b): this was left blank

Proceeds (Ref Box 1d): the inflation-adjusted value of the TIPS I invested

Cost or Other Basis (Ref Box 1a): $.00

Accrued Marked Discount (Ref Box 11): $.00

CUSIP: [the CUSIP Number]

Transaction Confirm #: [the Transaction Confirm #]

Type of Gain or Loss (Ref Box 2): this was left blank

If Checked, Noncovered Security (Ref. Box 5): This is checked

Reported to IRS (Ref Box 6): Gross Proceeds

Check if basis reported to IRS (Ref. Box 12): this was left blank

The 1099-B does not report the interest. It is reporting the capital transaction. It is showing your gross proceeds with zero basis. When you have a capital transaction your taxable income is the difference between the gross proceeds and your basis. Since this 1099 is showing a zero cost basis which of course is not correct, that means that you are responsible yourself for knowing your basis. Your basis is going to be whatever you initially put into the investment if you used after tax money to fund the investment, plus any increase in the investment that you already paid tax on over the years.

So, if you did not take any money out of the investment over the years, and it was initially funded with after tax money, and you paid taxes on the interest accrued each year over the last 10 years, then your basis is going to be initial investment plus the total interest accrued over the years.

You probably are going to want a tax professional to assist you with this years taxes.