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You received form 1099B - correct?In which box or column do you have adjustment "D" reported?
That is correct - I just wonder if you correctly doing such adjustment as it must be reported on form 1099B.
If you received a Form 1099-B (or substitute statement) reporting the sale or retirement of a market discount bond, complete Worksheet for Accrued Market Discount Adjustment in Column (g)
See last page in instructions
This is the amount of your gain that is ordinary income.
Enter it as a negative amount (in parentheses) in Form 8949, column (g). Also, report it as interest income on your tax return.
So if your reporting is correct - that is correct tax treatment.