Are your credit card rewards taxable? Here’s why you’re receiving 1099s in the mail
Editor's Note
If you earn a lot of credit card rewards, you may wonder if you'll need to pay taxes on them. In most cases, no — your rewards aren't considered taxable income.
That said, we've seen reports of people receiving 1099s for some sign-up bonuses. Specifically, many Chase cardholders have received 1099s for sign-up bonuses on Marriott cobranded cards, the Amazon gift card they received as the sign-up bonus on Amazon cards and for promos or credits they have received through their credit card, as first reported by FlyerTalk and Doctor of Credit.
I feel their pain. I've received two 1099's from Chase in the past — one I was expecting and one I wasn't.
So, let's break down when you should expect a 1099 for your credit card rewards and what to do if you believe you received one in error.
Are credit card rewards taxable?
Generally speaking, credit card rewards are not taxable. In most cases, when you have to spend to earn rewards, those rewards are not considered taxable income. This means standard welcome bonuses, rewards you earn on your everyday credit card spending and credit card perks like statement credits are usually safe.
The exception to this rule is any bonus you get that doesn't require spending, including referral bonuses and automatic bonuses for opening a new bank account. Since you don't have to spend to earn them, these types of bonuses are considered taxable income.
Related: Should I pay my taxes with a credit card?
Which credit card rewards are taxable?
While most rewards aren't taxable, one type is: referral bonuses you receive when someone applies for a credit card through your referral link. The bonus is considered income since you don't have to spend to get these rewards. (Your friend, conversely, wouldn't need to pay taxes on the bonus they earn for completing that spending.)
Related: Earn points, miles and cash back while doing your taxes
Is cash back taxable?
No, in most cases. A 2010 memorandum from the IRS says cash back earned via credit card spending is not considered taxable income. However, if you receive it as part of opening a bank account where you didn't have to complete a minimum spending requirement, you must report it as income.
Related: The best cash-back credit cards
Are business credit card rewards taxable?
Just like with personal cards, welcome bonuses and the rewards you earn from making purchases on your business credit card are not considered taxable income. However, when claiming business expenses, you can only claim the net cost of an item after any statement credits you receive as a perk from your credit card rather than the full cost before the credits are applied.
Related: The best business credit cards
Are bank account sign-up bonuses taxable?
Yes. Bank account sign-up bonuses are similar to credit card referral bonuses — you don't have to spend to earn them. This means they're taxable, according to the IRS. Just like with credit card referral bonuses, there's no guarantee you'll get a 1099 for these bonuses, but you're expected to claim them as income regardless.
Will I receive a 1099 for my credit card rewards?
Sometimes, you'll receive a 1099-MISC or a 1099-INT if a card has given you taxable rewards. A 1099 is often called an information return document for the IRS that shows the income you've received from a third party.
However, not all issuers will send these forms. We recommend keeping your own records since you'll still need to report all of your income — even if you don't receive a 1099.
Related: If I cash out my points and miles, do I have to claim it on my taxes?
Which issuers send 1099 forms for credit card rewards?
Most major issuers send 1099s for referral bonuses worth $600 or more. If you don't get a 1099, you can request one from your bank or estimate the income. Even if the bank doesn't send one, you must still report the income to the IRS.
Despite the general rule that you'll only get a 1099 for referral bonuses, Capital One has also sent them in recent years for statement credits. They appear to be treating these as gifts, which can be taxable.
Additionally, in 2024, some have reported getting a 1099 from Chase for the Amazon gift card they received as a sign-up bonus on Amazon cards. I got my card during October's Prime Day and received a $150 gift card as my bonus.
Sure enough, I got a 1099 for the $150 in the mail and a 1099 for the Chase referral bonuses I got the previous year.
TPG contributing editor Matt Moffitt received a 1099 from Capital One for his referral bonuses from 2023. He received 100,000 Capital One miles for four referrals, which Capital One valued at 1 cent each. As a result, his 1099 was for $1,000 in taxable income.
Many also report receiving a 1099 for their Marriott bonus of five free nights, which we haven't seen in the past.
You can contact the issuer for clarification or correction if you receive a 1099 that you believe was in error.
Historically, banks have treated statement credits and bonus points as rebates on spending, which the IRS does not view as taxable income. So far, we haven't seen major issuers consistently make this move, but we'll keep an eye on it. If sign-up bonuses and statement credits are regularly taxed, that will go into our evaluation of a card's net value year over year.
Related: Capital One expands benefits it considers taxable
Where do I report my credit card rewards income on a 1099?
You should include the income under the heading "Other income" on line 8z of your 1040 as reported under the "Other income" from Schedule 1, line 22.
If you need to calculate the value of referral bonuses, use the issuer's valuation of their points or miles versus a third-party valuation. For example, Capital One values their miles at one cent per point, whereas TPG's February 2025 valuations peg them at 1.85 cents per point. When calculating the value of Capital One referrals, you'll want to use their one-cent-per-point valuation.
Bottom line
Even if you've earned thousands of dollars worth of rewards this year through credit card welcome bonuses and everyday spending, you generally won't have to pay taxes on those rewards. However, you must pay taxes on rewards from referral bonuses or opening a new bank account. Keep your own notes on these sources of income, as the bank may not send you a 1099 for these earnings.
If you're concerned about owing taxes for your credit card rewards or you have further questions, consult a tax professional.
Related: Earn points, miles and cash back while doing your taxes
TPG featured card
at American Express's secure site
Terms & restrictions apply. See rates & fees.
| 3X | Earn 3X Miles on Delta purchases. |
| 1X | Earn 1X Miles on all other eligible purchases. |
Pros
- Delta SkyClub access when flying Delta
- Annual companion ticket for travel on Delta (upon renewal)
- Ability to earn MQDs through spending
- Various statement credits for eligible purchases
Cons
- Steep annual fee of $650
- Other Delta cobranded cards offer superior earning categories
- Earn 100,000 Bonus Miles after you spend $6,000 or more in purchases with your new Card within the first 6 months of Card Membership and an additional 25,000 bonus miles after you make an additional $3,000 in purchases on the Card within your first 6 months, starting from the date that your account is opened. Offer Ends 04/01/2026.
- Delta SkyMiles® Reserve American Express Card Members receive 15 Visits per Medallion® Year to the Delta Sky Club® when flying Delta and can unlock an unlimited number of Visits after spending $75,000 in purchases on your Card in a calendar year. Plus, you’ll receive four One-Time Guest Passes each Medallion Year so you can share the experience with family and friends when traveling Delta together.
- Enjoy complimentary access to The Centurion® Lounge in the U.S. and select international locations (as set forth on the Centurion Lounge Website), Sidecar by The Centurion® Lounge in the U.S. (see the Centurion Lounge Website for more information on Sidecar by The Centurion® Lounge availability), and Escape Lounges when flying on a Delta flight booked with the Delta SkyMiles® Reserve American Express Card. § To access Sidecar by The Centurion® Lounge, Card Members must arrive within 90 minutes of their departing flight (including layovers). To access The Centurion® Lounge, Card Members must arrive within 3 hours of their departing flight. Effective July 8, 2026, during a layover, Card Members must arrive within 5 hours of the connecting flight.
- Receive $2,500 Medallion® Qualification Dollars with MQD Headstart each Medallion Qualification Year and earn $1 MQD for each $10 in purchases on your Delta SkyMiles® Reserve American Express Card with MQD Boost to get closer to Status next Medallion Year.
- Enjoy a Companion Certificate on a Delta First, Delta Comfort, or Delta Main round-trip flight to select destinations each year after renewal of your Card. The Companion Certificate requires payment of government-imposed taxes and fees of between $22 and $250 (for itineraries with up to four flight segments). Baggage charges and other restrictions apply. Delta Basic experiences are not eligible for this benefit.
- $240 Resy Credit: When you use your Delta SkyMiles® Reserve American Express Card for eligible purchases with U.S. Resy restaurants, you can earn up to $20 each month in statement credits. Enrollment required.
- $120 Rideshare Credit: Earn up to $10 back in statement credits each month after you use your Delta SkyMiles® Reserve American Express Card to pay for U.S. rideshare purchases with select providers. Enrollment required.
- Delta SkyMiles® Reserve American Express Card Members get 15% off when using miles to book Award Travel on Delta flights through delta.com and the Fly Delta app. Discount not applicable to partner-operated flights or to taxes and fees.
- With your Delta SkyMiles® Reserve American Express Card, receive upgrade priority over others with the same Medallion tier, product and fare experience purchased, and Million Miler milestone when you fly with Delta.
- Earn 3X Miles on Delta purchases and earn 1X Miles on all other eligible purchases.
- No Foreign Transaction Fees. Enjoy international travel without additional fees on purchases made abroad.
- $650 Annual Fee.
- Apply with confidence. Know if you're approved for a Card with no impact to your credit score. If you're approved and you choose to accept this Card, your credit score may be impacted.
- Terms Apply.
- See Rates & Fees