The 1099 That I Hadn't Thought About or Even Considered

[dbfolks166mt]

     With all the postings about the 1099's, which being a resident of Virginia and having received them for several years because of the lower thresholds that were established by the state in 2020, this is the one I had not even thought about or considered. 

     Like a lot of people I participate in a cash back rewards program(s) on my credit cards. Going through my accounts this morning I happened to notice the following. O well, more 1099's and/or income to add to the list next year.   

 "Your participation in the program may result in miscellaneous income received from xxxxxx and we may be required to send you, and file with the IRS, a Form 1099-MISC (Miscellaneous Income) or Form 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding) for the year in which you participate and are awarded the benefits of this program. You are responsible for any tax liability related to participating in this program. Please consult your tax advisor if you have any questions about your personal tax situation." 

[luckythewinner]

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@dbfolks166mt wrote:

     With all the postings about the 1099's, which being a resident of Virginia and having received them for several years because of the lower thresholds that were established by the state in 2020, this is the one I had not even thought about or considered. 

     Like a lot of people I participate in a cash back rewards program(s) on my credit cards. Going through my accounts this morning I happened to notice the following. O well, more 1099's and/or income to add to the list next year.   

 "Your participation in the program may result in miscellaneous income received from xxxxxx and we may be required to send you, and file with the IRS, a Form 1099-MISC (Miscellaneous Income) or Form 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding) for the year in which you participate and are awarded the benefits of this program. You are responsible for any tax liability related to participating in this program. Please consult your tax advisor if you have any questions about your personal tax situation." 

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A quick Google showed me several online articles that said most cash back rewards are not taxable, unless they are referral bonuses or sign-up bonuses that did not require spending in order to earn it.

https://money.usnews.com/credit-cards/articles/are-credit-card-rewards-taxable

[dbfolks166mt]

     Pretty familiar with the rules but it's potentially just another 1099 to deal with. Easy to explain and write off my taxes but just more paperwork to have to add to the tax pile. 

[katzrul15]

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@dbfolks166mt wrote:

     Pretty familiar with the rules but it's potentially just another 1099 to deal with. Easy to explain and write off my taxes but just more paperwork to have to add to the tax pile. 

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Thanks for the heads up.  We have seen this with Discover and Mariott for some time.  If they give you redeemable points or tangibles in exchange for reviews/ratings (like an influencer) you will receive a 1099 for those values.  Has not yet applied to us, but guess it could change.

Influencers make good money doing what they do.  Good topic/info! 

[wildpitchsports]

Wow, hadn't even thought about that impact myself. Add another one to the "government cash grab" pile starting next year. 

The amount of people that are going to get REKT by the change will be insane.