Tax for ThankYou points redemption?

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Does Citi still report ThankYou points redemption to IRS? I remember reading about it here before, but it seems that it is not mentioned any more.

Do they still do it? If yes, what is the annual threshold?

Thanks

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They never did. And do not now. This is not income. Rather it is a discount on the price paid

You might be confusing the bank account bonuses with the credit card ones. For a bank account, they often report bonuses (cash normally, not sure about the points) as interest.

Credit/debit card points from purchases are not taxable. But other points, such as points from banking account relationships and bank account opening bonuses, would be taxable. Only redeeming taxable points can land you a 1099-MISC and you generally should not receive one unless you redeem at least $600 worth of taxable points in a single tax year. Citi historically has issued 1099s for the tax year in which taxable points are redeemed rather than accumulated.

mespin said:   Credit/debit card points from purchases are not taxable. But other points, such as points from banking account relationships and bank account opening bonuses, would be taxable. Only redeeming taxable points can land you a 1099-MISC and you generally should not receive one unless you redeem at least $600 worth of taxable points in a single tax year. Citi historically has issued 1099s for the tax year in which taxable points are redeemed rather than accumulated.
Only redeeming taxable points can land you a 1099-MISC and you generally should not receive one unless you redeem at least $600 worth of taxable points plus interest in a single tax year.

mespin said:   Credit/debit card points from purchases are not taxable. But other points, such as points from banking account relationships and bank account opening bonuses, would be taxable. Only redeeming taxable points can land you a 1099-MISC and you generally should not receive one unless you redeem at least $600 worth of taxable points in a single tax year. Citi historically has issued 1099s for the tax year in which taxable points are redeemed rather than accumulated.

I don't think the points can be correctly classified as 1099-MISC income. Bank bonuses are usually reported on 1099-INT which have significantly lower reporting thresholds (currently $10 since this transaction wouldn't qualify as an exception). Additionally, if the bank reports the bonus, it should report the bonus when the points are paid as opposed to when the points are redeemed.

jetsfan92588 said:   I don't think the points can be correctly classified as 1099-MISC income. Bank bonuses are usually reported on 1099-INT which have significantly lower reporting thresholds (currently $10 since this transaction wouldn't qualify as an exception). Additionally, if the bank reports the bonus, it should report the bonus when the points are paid as opposed to when the points are redeemed.

That's probably a defensible position, although that's not how Citi interprets the law. Citi's practice is to issue a 1099-MISC. Here is a snippet from the Thank You terms and conditions for checking accounts:

Redemption of ThankYou Points received for Products and Services may result in your receipt of taxable income from Citibank in the tax year in which the ThankYou Points are redeemed. In accordance with U.S. tax law, Citibank may be required to send to you and file with the IRS a Form 1099-MISC (Miscellaneous Income) for the year in which a reward is issued to you. The valuation of ThankYou Point redemptions for Form 1099-MISC tax reporting purposes will be at Citibank’s sole discretion. You are solely responsible for any personal tax liability arising out of the redemption of ThankYou Points. Please consult with your Tax Advisor if you should have any questions regarding your personal tax situation



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