1099 INT Question

[skives]

I received a $400 bonus last year from Citi Bank on a checking account and $100 bonus on savings account. I have not received a 1099 INT form form them on either bonus. I called today and they said since it was less than $600 they won’t send a 1099 INT. Do I need to claim this on my taxes still?

[Jluke]

Quick google search says Yes.

I am not a tax professional

[kork13]

Also not a tax pro, so be warned...

To my knowledge, account opening bonuses are treated the same as credit card rewards, and are not taxed (thus not reported). Perhaps they're in the same realm as gambling earnings, in which amounts above $XXX (it might actually be $600) are reported on 1099, and thus taxable. By contrast, consider than any amount of earned interest above $5 or $10 is 1099'd & reported.

Personally, if they don't issue a 1099 for it, I'm probably not reporting it on my taxes, because the IRS doesn't know the money exists, and why screw with it for trivial amounts? I also wouldn't report finding a $20 on the sidewalk under the same rationale. Totally different circumstances, but effectively the same in my mind.

But again... What do I know.
High five to MonkeyMama (the real expert around here)

[MonkeyMama]

First... Don't get tax advice on the internet.
But apparently, Citi Bank was also completely useless.

Bank account bonuses are treated as taxable interest. The threshhold for filing a 1099-INT is just $10. Were these business accounts? For business accounts, Citi might be right.

Personally, if they don't issue a 1099 for it, I'm probably not reporting it on my taxes, because the IRS doesn't know the money exists, and why screw with it for trivial amounts?

All income is supposed to be reported on your tax return. I know many people believe they don't have to report something if the IRS doesn't know about it, but that's pretty much just cheating. Most W-2 wages and basic investments will be reported to the IRS, but there's vasts amount of different types of income that is never reported to the IRS. For example, if you lease property to individuals, or sell services to individuals... Individuals do not have to prepare 1099 forms for everyone they hire or pay rent to.

I'd personally report the $500 income. But I like to be able to sleep well at night. In this case, Citi will likely eventually realize that someone made a big mistake and they may fix it. So just because you haven't gotten a 1099 yet doesn't mean that you won't. Businesses are penalized far more heavily for not filing 1099s, versus filing late 1099s.

[kork13]

First... Don't get tax advice on the internet.

Agreed wholeheartedly. As is apparent, I'm not a great source for tax advice....and why I punted -- thanks MM!!

Bank account bonuses are treated as taxable interest. ....... I know many people believe they don't have to report something if the IRS doesn't know about it, but that's pretty much just cheating.

Interesting... I've never received 1099s for any of the various bank or other bonuses I've received over time. But I suppose you're right about the self-reporting requirement (ethically, I mean -- you obviously have the law on your side as well).

[MonkeyMama]

But again... What do I know.
High five to MonkeyMama (the real expert around here)

Thanks for the vote in confidence. I answered this one because it was fairly simple. But I no longer work in tax.
I do always recommend Bogleheads because it's the only place on the internet where I have seen good/useful tax advice.

[mumof2]

Just call the tax office they would be able to assist you on what you need to do!!

[MonkeyMama]

Interesting... I've never received 1099s for any of the various bank or other bonuses I've received over time.

I have always received 1099s for bank bonuses. We had several this year and they were all reported on 1099-INT.

[disneysteve]

I've never received 1099s for any of the various bank or other bonuses I've received over time.

That's odd that you didn't get a 1099 for your interest. I have gotten one every year from any bank account that paid me more than $10 that year. Is it possible that your 1099 was available electronically and you missed the notice to go in and view it?

[skives]

Mine was for a checking/savings account signup bonus not interest.

[disneysteve]

Mine was for a checking/savings account signup bonus not interest.

MonkeyMama said bonuses are treated the same as interest for tax purposes. I wonder why they don't just include it with the regular 1099-INT.

[kork13]

That's odd that you didn't get a 1099 for your interest. I have gotten one every year from any bank account that paid me more than $10 that year. Is it possible that your 1099 was available electronically and you missed the notice to go in and view it?

I always get them for interest, and always wait to file until I've got the documents from each of my banks/investment accounts. But for bonuses, I've never seen it included. Perhaps they added it in to the total interest and I've simply not noticed their total being higher than my earned interest for the year? I dunno.

[Jluke]

Quick google search says Yes.

I am not a tax professional

As part of my search yesterday I confirmed the $600 threshold for reporting bank bonus on a 1099-MISC.

it would most likely not appear in the 1099-INT.

[moneybags]

As part of my search yesterday I confirmed the $600 threshold for reporting bank bonus on a 1099-MISC.

it would most likely not appear in the 1099-INT.

I got a 1099 INT for a $200 bonus from Chase. It probably depends on how the bank classifies the bonus. For regular interest, some banks don't issue unless interest is at least $60.

[Jluke]

I got a 1099 INT for a $200 bonus from Chase. It probably depends on how the bank classifies the bonus. For regular interest, some banks don't issue unless interest is at least $60.

Yes. Completely agree.

I was trying to explain OPs specific case.

my credit union INT cutoff is $10