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
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- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
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| 4X | Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 4X | Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 3X | Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com. |
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You may be eligible for as high as 100,000 Membership Rewards® Points after spending $6,000 in eligible purchases on your new Card in your first 6 months of Membership. Welcome offers vary and you may not be eligible for an offer.As High As 100,000 points. Find Out Your Offer.Annual Fee
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Why We Chose It
There’s a lot to love about the Amex Gold. It’s a fan favorite thanks to its fantastic bonus-earning rates at restaurants worldwide and at U.S. supermarkets. If you’re hitting the skies soon, you’ll also earn bonus Membership Rewards points on travel. Paired with up to $120 in Uber Cash annually (for U.S. Uber rides or Uber Eats orders, card must be added to Uber app and you can redeem with any Amex card), up to $120 in annual dining statement credits to be used with eligible partners, an up to $84 Dunkin’ credit each year at U.S. Dunkin Donuts and an up to $100 Resy credit annually, there’s no reason that foodies shouldn’t add the Amex Gold to their wallet. These benefits alone are worth more than $400, which offsets the $325 annual fee on the Amex Gold card. Enrollment is required for select benefits.Pros
- 4 points per dollar spent on dining at restaurants worldwide and U.S. supermarkets (on the first $50,000 in purchases per calendar year; then 1 point per dollar spent thereafter and $25,000 in purchases per calendar year; then 1 point per dollar spent thereafter, respectively)
- 3 points per dollar spent on flights booked directly with the airline or with amextravel.com
- Packed with credits foodies will enjoy
- Solid welcome bonus
Cons
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber and other dining credits
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $6,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
- Earn 2X Membership Rewards® points per dollar spent on prepaid hotels and other eligible purchases booked on AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- $120 Uber Cash on Gold: Add your Gold Card to your Uber account and get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an American Express Card for your transaction. That’s up to $120 Uber Cash annually. Plus, after using your Uber Cash, use your Card to earn 4X Membership Rewards® points for Uber Eats purchases made with restaurants or U.S. supermarkets. Point caps and terms apply.
- $84 Dunkin' Credit: With the $84 Dunkin' Credit, you can earn up to $7 in monthly statement credits after you enroll and pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment is required to receive this benefit.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
- $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
- Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.