Q: Citibank reporting "free" airline miles to IRS as income for opening checking / savings accounts!

3 0

http://articles.latimes.com/2012/jan/24/business/la-fi-lazarus-20120124

YesBoss (rep: 7.42k) posted Feb 20, 2012

64 views

6 Answers

That is dirty :D

akaricke (rep: 139k) posted Feb 20, 2012

1 0

I wonder if they will remove this after this goes viral - like a few others have in the past?!?

FibroMom (rep: 58.3k) posted Feb 20, 2012

0 0

Rebates are not taxable, according to the IRS, since they are simply a price reduction on a purchase. If Citibank is giving miles away for merely opening a checking account, that might conceivably be a different story. I suppose if there are any fees on the checking account, it might still be considered a price reduction.

I know that when I got a bonus for a friend signing up for a checking account at my bank (not Citibank), it was reported as interest earned on the account. Hmmmm, I wonder if ATM fee rebates are taxable.

fluffy (rep: 1.85k) posted Feb 20, 2012

1 0

The IRS considers almost anything that someone gives you as a "taxable event" though they only go after those events if they are reported. I really doubt that CitiBank has any requirement to report points to the IRS. Points could be considered a rebate of your purchase price and you already paid tax on that purchase.

erick99 (rep: 7.85k) posted Feb 20, 2012

0 0

Oh that is so Evil! First the credit card companies lure people into buying their cards cause they have all these free miles to give away and then they go ahead and report it to the IRS! Evil pure Evil!

Florida2Texas (rep: 6.2k) posted Feb 20, 2012

0 0