What is 1099 OID? How come I am loosing money on this investment and still have to pay income tax? thx.?

Question

What is 1099 OID? How come I am loosing money on this investment and still have to pay income tax? thx.?

Answer 1

You can have capital gains distributions that create a taxable event even when you loose money. Got you going and coming, beautiful system.

Answer 2

Let's say you bought a stock on January 1 for 100. It paid a dividend of 10 on October 1. On December 31 the stock's value is 80. You have definitely lost money on this stock, but only the 10 dividend is taxable, not the unrealized gain of 80 - 100 = -20.

Answer 3

If you sell you can claim a loss, but you are probably paying for the dividends which are a gain.

Answer 4

fcas80 is right.