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1099-INT box 10, market discount.
When the payer reports accrued market discount, and when it moves to Form 1099-OID.
Box 10 of Form 1099-INT shows accrued market discount on a covered security, but only when the recipient told the payer a section 1278(b) election was made, and only for amounts of $10 or more. If the covered security has OID, the accrual is reported on Form 1099-OID instead.
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Result
What the instruction says
For a covered security acquired with market discount, if the recipient notified the payer that a section 1278(b) election was made, the payer enters the amount of market discount that accrued on the debt instrument during the year, in the amount of $10 or more. The instructions cite Regulations section 1.6045-1(n).
How the accrual is measured
Unless the taxpayer notified the payer that it did not make a section 1276(b) election, the payer uses the constant yield method described in section 1276(b)(2). The instructions cite Regulations section 1.6045-1(n)(11)(i)(B) for this.
Covered securities with OID
When the covered security has OID, market discount accruals are reported on Form 1099-OID. That form has its own box 5 for market discount on a covered security acquired with market discount and OID, with the same election-notice and $10 conditions.
Worked example (made-up figures)
A holder buys a bond at a market discount and tells the broker in writing that a section 1278(b) election was made. The broker computes $38 of accrued market discount for the year and enters $38 in box 10. A holder who bought a similar bond with $6 of accrued discount would see nothing in box 10, because the amount is under $10.
Related decoders
More 1099 interest and dividend box pages: 1099-INT box 3, 1099-INT box 11, 1099-INT box 2, 1099-DIV box 2a, 1099-OID box 8. For the 1099-R box 7 codes see the 1099-R distribution codes lookup.
Sources
- Instructions for Forms 1099-INT and 1099-OID (01/2024): the box-by-box section for this form. Read November 2, 2026. The IRS page was last reviewed April 30, 2026.
Edition read: Instructions for Forms 1099-INT and 1099-OID (01/2024). These instructions are continuous use and are updated as needed, so check the current version before relying on a detail. This page summarizes the instructions and does not replace them; the worked example uses made-up figures.
Frequently asked questions
What is box 10 on a 1099-INT?
Accrued market discount on a covered security, reported when the recipient told the payer a section 1278(b) election was made, in an amount of $10 or more.
What is the dollar line for box 10?
$10 or more of accrued market discount for the year.
Why is market discount on my OID bond not on the 1099-INT?
For a covered security with OID, the instructions say to report market discount accruals on Form 1099-OID, not Form 1099-INT.
How does the payer compute the accrual?
With the constant yield method in section 1276(b)(2), unless the taxpayer said it did not make a section 1276(b) election.
Where can I read the regulation?
The instructions cite Regulations section 1.6045-1(n) and, for the accrual method, section 1.6045-1(n)(11)(i)(B).
Not tax advice
This page summarizes IRS instructions, mostly written for the people who prepare the form, and is not tax, legal or financial advice. The payer, a CPA or an enrolled agent can confirm what a box means for your return. Everything runs in your browser; nothing you enter is sent anywhere.