How to document a bank bonus for your tax return
Keep four records: the offer page dated when you enrolled, the enrollment confirmation, the account line that shows the bonus posting and its date, and Form 1099-INT when it arrives. The IRS taxes interest in the year it becomes available, and it says you report that interest even if no 1099-INT comes. Chase and Capital One both say the checking bonus is reported on Form 1099-INT. The posting date, not the day you qualified, is the year.
The tax return needs a figure and a year. The bank's website will not still show the offer in April. Build the file while the account is open.
What the IRS already requires
Most interest credited to an account you can withdraw from without penalty is taxable in the year it becomes available to you. 1 If you received interest of $10 or more, you should receive Form 1099-INT. 1 You must report taxable interest even if you do not receive the form. 1 Do you pay taxes on bank bonuses is the rule. This page is the folder that makes the rule easy to follow.
What each bank page adds
Chase says the Total Checking bonus is considered interest and will be reported on Form 1099-INT, or Form 1042-S if applicable. 3 Capital One says the amount of the 360 Checking bonus will be reported on Form 1099-INT to the IRS and to your state if required. 4 Those sentences tell you which form to look for. They do not tell you the day the cash posted. The activity line does.
The four items to save
- The offer PDF or full-page capture, with the date you read it and the date you enrolled.
- The enrollment confirmation, including any offer code.
- The activity entry for the bonus credit, showing the amount and the posting date.
- Form 1099-INT, and the year-end statement if the form is late.
A bonus that posts in January belongs to that January year, even if you finished the deposits in December. 1 Why the bonus has not posted matters here, because a bonus that has not posted is not yet interest you can withdraw.
If the form and the activity disagree
Use the form on the return, and keep the activity line as the question you send the bank. Do not invent a split between "bonus" and "interest" if the form reports one interest total. A $300 bonus at a 22% federal rate is $66 of federal tax before any state tax. That is a planning figure. The bank bonus tax calculator applies your rate. Is a bank bonus worth it wants the after-tax amount, not the banner.
Reversals and accounts you already closed
If the bank reverses the bonus, save that debit too. You do not want to report cash that left the account before year end, and you do want a record if the form still includes it. Closing the account does not close the tax year. Download the activity before you close. The close rules are in can you close a bank account after the bonus. The bank bonus tracker can hold the posting date next to the offer you saved.
Common questions
Which number do I report if the 1099-INT includes ordinary interest too?
Report the interest on the form. The bonus is part of that interest, not a separate gift. Your posting screenshot explains the figure to you. It does not replace the form when the form arrives.
What if the bank paid in January but I qualified in December?
Use January. The IRS taxes interest in the year it becomes available to you. Qualification is not availability. The activity date is the fact to file.
Do I need a receipt if I already have the 1099-INT?
Keep the offer and the posting line anyway. They are how you explain a mismatch, a reversal, or a missing form. They take one folder and they outlast the bank's webpage.
Sources
CardLab tracks the cards you hold and the bonuses you are chasing, with every rate read from the issuer's own page.
Get CardLabWhich card to use