Posted by Chuck on January 20, 2019
Bank Account Bonuses

Published on January 20th, 2019 | by Chuck

43

Chase Sending Out 1099s for Ultimate Rewards Checking Bonuses at 1 Cent-Per-Point

Chase recently began offering some checking bonuses in the form of Ultimate Rewards instead of cash. There’s the current Sapphire Banking 60,000 points bonus for personal accounts, and there was previously – now expired – a 30,000 or 50,000 points bonus for a business checking account earlier this year. We weren’t positive how Chase would value the Ultimate Rewards points or if they’d send a Form 1099 at all.

The verdict is now in: they do send a Form 1099INT for points bank bonuses with a valuation of 1 cent per point. A friend just got a Form 1099INT for the 30,000 points business checking bonus, and presumably the Sapphire Banking bonus is getting a Form 1099INT as well. It’s basically what we’d have expected, at least they aren’t valuing it more than 1 cent per point.

Citi also sends out a Form 1099 for bank bonuses which are in the form of ThankYou points, but they only send out if you earned $600+ since they consider it under the 1099MISC category1099 which is only required to be reported at the $600 threshold. Chase puts account bonuses along with interest earnings on the Form 1099INT which is reportable on earnings as little as $10.

We’ll have a post up tomorrow with a more general roundup of details on 1099 forms being sent out now.



43
Leave a Reply

avatar
 

  Subscribe  
newest oldest most voted
Notify of
Jr
Jr

I got one today also.

jan
jan

How about the bonus from the investment brokerage firm? Do they give out 1099 too?

Yoni
Yoni

It is pretty much what I was expecting would happen just didn’t know if it would be as 1099 as high as .125c or .015c per point since it was a DDA related bonus vs. Credit card rebate (points & cash back) . Even with a 1099 I think that the points are actually a pretty good bonus vs cash.
Kinda of kicking myself – in retrospect.

Ann
Ann

“didn’t know if it would be as 1099 as high as .125c or .015c per point”

1 cent = $0.01

1.25 cents = $0.0125

1.5 cents = $0.015

Yoni
Yoni

lol missed a zero there – cheers

Leo
Leo

Huh – had **no idea** what he meant until you cleared that up! Thanks for that great one. /s

Ann
Ann

Gee, I had no idea anyone could figure that out until your snarky reply. Great contribution.

JV
JV

I think it is important to note that even if you do not get a form 1099INT or 1099MISC, everything is supposed to be reported on your tax return. The limits for the specific forms are probably in effect to not put undue administrative burden for a lot of small transactions, but it does not alleviate our responsibility to report “all income from whatever source derived”. I’ll stop my rant now.

Frank Rizzo
Frank Rizzo

You can do that. As far as I am concerned, I get taxed enough as it is.

Leo
Leo

Just wait until you get his with an audit and penalties for underpayment. That’ll knock the smirk off your face.

Novacat05
Novacat05

Depends on your situation but if you don’t have a business, don’t itemize, no foreign accounts or transactions, the odds of you getting audited are about .01%. IRS isn’t going to waste many resources going after these people.

JV
JV

I do report everything and have Since I started filing. This was basically a reminder that everything is essentially reported, but you won’t get a tax form until it hits the threshold. Even if you earned $600 and failed to receive a 1099, it’s still our burden as taxpayers to report it. That is why good records is important, not only to know when we can churn a bonus, but to properly report our earnings.

Scott
Scott

I think Chase reports everything. They sent me a 1099 for $2.01.

mark atwood
mark atwood

Middle class should pay all the taxes they are due while the rich get away with the tax dodges that they help create…

Debit
Debit

The middle class should pay because they are stupid, easily divided, and will vote for short term gain in return for accept long term pain.

Joe
Joe

Whoa.

John
John

Yup, they vote for blowhards who promise a ‘Middle Class’ tax cut where 84% goes to the 1% (and of that, the .01% Billionaire Class gets the majority). But that’s not all – corporate taxes were dropped to 22% from 35% (guess who owns all those corporations – yup the Billionaire Class, woohoo!). In exchange, the 99% get to enjoy the massive increase in the national debt (it’s ballooned to over $1T/yr after the tax cuts). Privatize profits, socialize losses, so we bail out wealthy Banksters and jail mom and pop homeowners…

Frank

This seems reasonable. Tax on bank bonuses is expected and 1cpp is correct for chase

Orion
Orion

Would Chase referral bonus also counts toward the $600 threshold for 1099-MISC?

86
86

So UR points held by Chase from your bank account signup bonus are considered your property. UR Points held by Chase from your credit card account signup bonus are technically the property of Chase? The I.R.S. taxes the former but not the latter, because they consider the latter a discount and the former as income.

sevillada
sevillada

it’s not about whose property it is (which they are yours, in both cases). it’s about how they were obtained, CC rewards are a rebate, while bank bonuses are not. the first one requires a purchase, the latter not

86
86

“Points aren’t your property and have no cash value. You can’t transfer or move points unless expressly provided for in this agreement. Additionally, points can’t be transferred by operation of law, such as by inheritance, in bankruptcy or in connection with a divorce.”

(from: Chase Sapphire Reserve® with Ultimate Rewards Program Agreement – 6/28/2018).

Sevillada
Sevillada

Fine, but it’s not About ownership. You’re missing the point

86
86

I do understand your point about why they’re treated differently. But I used to assume that all UR points were pretty much governed under the same rules. But by Chase awarding bank account bonuses in UR points, that doesn’t seem to be the case.

Frugal Nellie (aka Lela)
Frugal Nellie (aka Lela)

So if Chase chose to take your points, they’d be seizing your property, that you were taxed on. Interesting. hmm. When Wells Fargo took all my points, they left my $25 signup bonus sitting there. I just can’t access it cuz I didn’t open a new account- they closed that account. Interesting that bank bonuses are more well protected…

Debit
Debit

Yup sounds like you have a case of filing a police complaint of larceny against the bank.

Jeff H
Jeff H

I did the $300.00 bonus Business Checking and a few months later, the $300.00 personal Total Checking. Each account paid with a $300.00 credit to each checking account. Not UR.
This week, I received two 1099-INT one for each account. The forms are identical in all details. .lt would be very easy to mistake them for duplicates.

Lrdx
Lrdx

I did checking + savings together, and have the same. It’s just one issued form, only both accounts link to it.

Alfonso Aguilar
Alfonso Aguilar

So what if I had three different cards less than $6oo in value but then combined them, the points were earned separately using different chase cards, now one card has 200,000 combined points from multiple cards
(1) does adding the points from multiple cards into one card automatically make me receive the 1099
(2) do I automatically get the 1099 if I still haven’t used the points or cashed them out.

Rob
Rob

Chase doesn’t send out 1099s on bonuses earned on credit cards. Only bank accounts.

Albert
Albert

Not true about Citi, i did the $300 bank bonus and got a 1099 for it.

Rob
Rob

Cash bonuses are reported in the year earned. Thank You points bonuses are reported when you redeem them. Sounds like you got a cash bonus.

NinjaX
NinjaX

and this is why i dont do chase bank deposit pts.

first you potentially pay income tax or at least explain to the IRS why your too poor to pay, then maybe pay YQ on that shit or get told to fuck off because your “taxable points” are non-transferable to airlines (aka citi).

no thank you.

nick
nick

i received one from chase for regular checking and savings and that is normal from chase…. what does happen if bank doesn’t send one out and you received a bonus from them? do you have to go in a branch and request one or not? thanks

Ann
Ann

If you didn’t receive a 1099 covering something you think should have been on one, you can still add it to your tax filing without an associated 1099 if you want to. I don’t think Chase can generate 1099s for things their automated system didn’t decide to generate one for.

JV
JV

You would include it on your tax form anyways. You do not need a 1099/W-2 etc to claim income, its more of a convenience to help you file your taxes. Best of luck

qmc
qmc

If your copy never got issued, the IRS may not know about it, but if your copy got lost in the mail, IRS is definitely going to know about it.

This fellow recommends reporting the income but not asking for the 1099. https://www.forbes.com/sites/robertwood/2015/01/29/missing-a-form-1099-why-you-shouldnt-ask-for-it/

Frugal Nellie (Lela)
Frugal Nellie (Lela)

Did anyone use a separate EIN for their business? If so, is the 1099 under the business tax ID, or personal? Should be business, but I’d like to double check.

Back to Top ↑