We're considering offering an interest bearing account (basically a tiered NOW account) & want to waive foreign ATM fees (fees charged by other banks when our customers use their ATM).

I know that I don't have any issues under Reg D or Reg Q since it will be an interest bearing account.

What I'm less sure about is if I have Reg DD or IRS reporting concerns.

(1) Will the fee waiver be a Reg DD bonus? Under Reg DD, waiving foreign ATM fees will not considered an absorption of an expense since it is not our own bank's expense that we're waiving. I don't think it's a bonus under Reg DD because at account opening we don't know the value of the foreign ATM fee waivers. Reg DD states, "Bonus means a premium, gift, award, or other consideration worth more than $10 (whether in the form of cash, credit, merchandise, or any equivalent) given or offered to a consumer during a year in exchange for opening, maintaining, renewing, or increasing an account balance. The term does not include interest, other consideration worth $10 or less given during a year, the waiver or reduction of a fee, or the absorption of expenses."

(2) Will we have any reporting IRS reporting requirements? 1099- MISC or 1099- INT?

Thanks.

Anyone?

I know that we do it with one of our accounts and don't have any reporting issues. Has been seen by both our external auditor and our regulator with no problems or issues. Hope this helps.

Where does it state this specifically?

The end result is the same, but I think there is a semantic difference between a waiver and an absorption.

You waive a fee you would normally charge, such as a monthly service charge.

You absorb an external expense normally passed along to the accountholder. That would include check printing and ATM fees.

Al

Am I misreading the following similiar post?

http://www.bankersonline.com/forum/ubbth...true#Post472269

Do I have Reg DD & IRS reporting issues with this type of account?

Thanks.