Form 1099-OID 2019 Payer Filing Checklist
Purpose and 2019 Coverage
Form 1099-OID reports original issue discount, qualified stated interest, market discount, acquisition premium, and bond premium for taxable and tax-exempt obligations held during 2019. The 2019 instructions expanded to cover security reporting rules for tax-exempt obligations acquired on or after January 1, 2017, requiring payers to separately report acquisition premium amortization and premium amortization where applicable, distinguishing noncovered securities that require only gross reporting.
Taxpayer Identification and Display Requirements
You must obtain the complete recipient TIN, which includes Social Security Number, Individual Taxpayer Identification Number, Adoption Taxpayer Identification Number, or Employer Identification Number. Validate the TIN against IRS records before filing to reduce backup withholding notices and penalty assessments.
Display only the last four digits of the TIN on Copy B furnished to the recipient. Report the full TIN to the IRS on Copy A for processing and verification purposes.
Tax-Exempt Covered Security Reporting
Determine whether the obligation is taxable or tax-exempt before preparing the form. For tax-exempt covered securities acquired on or after January 1, 2017, and issued with OID, separately report the OID amount in box 11, acquisition premium amortization in box 6, and premium amortization in box 10 when applicable to the reporting period.
Original Issue Discount Calculations
Calculate OID for the part of the year the recipient held the obligation using accurate accrual methods. Consult Publication 1212 for adjustments due to acquisition premium, bond premium, stripped bonds, or Treasury inflation-protected securities.
Treasury inflation-protected securities explicitly fall within OID rules requiring payer calculation and reporting. Negative numbers in box 8 represent deflation adjustments per Publication 550.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
Qualified Stated Interest Reporting
Report qualified stated interest in box 2 separately from OID amounts to maintain proper tax treatment distinctions. When both box 2 and box 8 contain amounts, the box 2 interest on U.S. Treasury obligations receives an exemption from state and local income tax.
Market Discount Requirements
Enter market discount in box 5 only for covered securities where the recipient made a written election under section 1278(b) to include market discount as it accrues and notified the payer in writing per Regulations section 1.6045-1(n)(5). For covered securities acquired on or after January 1, 2014, calculate market discount on a constant yield basis unless the recipient elected otherwise in writing.
Acquisition Premium Treatment
For covered securities acquired with an acquisition premium, report either net OID reflecting the offset by amortization in box 6 or gross OID with gross amortization separately entered in box 6. For noncovered securities, report gross OID only without a separate box 6 entry.
FATCA Compliance
Complete the FATCA filing requirement checkbox if you are reporting to satisfy your chapter 4 account reporting obligation as a payer. The recipient may have a separate filing requirement under Form 8938 for specified foreign financial assets.
Filing and Furnishing Deadlines
Furnish Copy B to the recipient by January 31, 2020, allowing adequate time for tax return preparation. File Copy A with the IRS by February 28, 2020, when filing on paper or by March 31, 2020, when filing electronically using software that generates files per Publication 1220 specifications.
Electronic filing provides additional processing time and reduces filing errors through automated validation. These deadlines apply consistently across all Form 1099-OID submissions, regardless of the complexity or number of recipients involved.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
Nominee Reporting Procedures
Issue a separate Form 1099-OID for each owner of record in nominee recipient situations where you hold securities on behalf of others. List yourself as the payer and the other owner as the recipient on each form.
File Copy A with the IRS using Form 1096 as the transmittal document. Spouses are exempt from nominee filing requirements for amounts owned by the other spouse.
Nonresident Alien Considerations
Determine your withholding obligation for nonresident alien recipients before processing payments or reporting amounts. Review whether Form 1042-S filing is required per Instructions for Form 1042-S and Publication 515.
Obligation Identification
Include the CUSIP number or obligation description in box 7 showing the stock exchange, issuer, coupon rate, and maturity year where this information is available. Complete identification allows recipients and the IRS to match reported amounts with specific securities.
Purchase and Sale Transactions
Do not issue Form 1099-OID for obligations purchased or sold during the year unless you are the record holder responsible for reporting. The responsibility for reporting lies with the entity holding the obligation as record holder at the required reporting times during the calendar year.
Backup Withholding Enforcement
Backup withholding enforcement continues under 2019 rules with mandatory withholding when recipients fail to furnish a TIN or furnish an incorrect TIN. Payers must reference Form W-9 for complete backup withholding information and current withholding rates.
Report withheld amounts in box 4 even when the OID amount falls below the normal reporting threshold of ten dollars. This requirement ensures proper tax compliance tracking regardless of payment size or frequency during the reporting period.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
