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#2168794 - 03/16/18 08:27 PM Re: Reg DD Bonus and Advertisements jonv
Compliance NABW Offline
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I'm not sure anybody is an IRS expert in here, but I was glad to see the differentiation RL made regarding the $600 for the 1099 Misc, as the $500 for singing up for e-Statements is getting one pretty close to that threshold. However, the 1099 INT was more extensive than the TISA bonus rules, in that it just had to be connected to an account, not necessarily to the opening of the account. So, as signing up for e-Statements is still a feature connected with a deposit account and is credited to said account, then it would be a 1099 INT. Also, I see this in the instructions for the Form, but I don't see that it specifically includes commercial banks:

Box 1. Interest Income

Enter taxable interest not included in box 3. Include amounts of $10 or more, whether or not designated as interest, that are paid or credited to the person's account by savings and loan associations, mutual savings banks not having capital stock represented by shares, building and loan associations, cooperative banks, homestead associations, credit unions, or similar organizations. Include interest on bank deposits, accumulated dividends paid by a life insurance company, indebtedness (including bonds, debentures, notes, and certificates other than those of the U.S. Treasury) issued in registered form or of a type offered to the public, or amounts from which you withheld federal income tax or foreign tax. In addition, report interest of $10 or more attributable to a TIH of a WHFIT, or accrued by a real estate mortgage investment conduit (REMIC), a financial asset securitization investment trust (FASIT) regular interest holder, or paid to a collateralized debt obligation (CDO) holder, as explained later.

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#2168806 - 03/16/18 09:05 PM Re: Reg DD Bonus and Advertisements Compliance NABW
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,352
Galveston, TX
Originally Posted By JPC
However, the 1099 INT was more extensive than the TISA bonus rules, in that it just ad to be connected to an account, not necessarily to the opening of the account.


And you have support for that statement? To be reportable on the 1099 - it first has to be interest as defined by the IRS. Under IRS regulations: The term “interest” means amounts paid for the use or forbearance of money.

How does signing up for e-statements fall into that category?
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#2169131 - 03/20/18 01:58 PM Re: Reg DD Bonus and Advertisements jonv
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Joined: Oct 2015
Posts: 1,597
The instructions clearly say "Include amounts of $10 or more, whether or not designated as "interest."

I think this is the one I came across that led me to that conclusion, but now that I read it again, it may have been another article. Basically, it said if the reward was connected to having a deposit account, then it's a 1099-Int.

http://rsmus.com/our-insights/newsletter...-conundrum.html

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#2171136 - 03/30/18 05:16 PM Re: Reg DD Bonus and Advertisements jonv
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Joined: Oct 2015
Posts: 1,597
Going back to the original statement by John on the post, what about the section in 1030.8(d) that states, "the advertisement shall state the following information, to the extent applicable, clearly and conspicuously . . .?"

Could the "to the extent applicable" be interpreted to mean that if an advertisement does not list an APY anywhere else in the ad, then the APY is not required just because you say "earn $50 for opening a checking account?"

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#2171139 - 03/30/18 05:26 PM Re: Reg DD Bonus and Advertisements jonv
rlcarey Offline
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Joined: Jul 2001
Posts: 79,352
Galveston, TX
It means to the extent that (d)(1) thru (5) is applicable. As such, if (d)(4) is not applicable, you don't have to mention it. Similarly, if the account is a non-interest bearing account, (d)(1) would not be applicable.
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#2171213 - 03/30/18 08:21 PM Re: Reg DD Bonus and Advertisements jonv
Compliance NABW Offline
Diamond Poster
Joined: Oct 2015
Posts: 1,597
Ok, so, yeah, that's where I was going with it. You have a no-interest checking account, it's not applicable. But, if you have any interest on the account, then just saying the bonus basically constitutes a triggering term.

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#2190820 - 08/28/18 02:55 PM Re: Reg DD Bonus and Advertisements jonv
IGaev Offline
Junior Member
Joined: Dec 2016
Posts: 43
I was hoping to resurrect this discussion. In terms of a bonus (as defined under Reg DD), in calculating and disclosing the APY, must the amount of the bonus, provided it exceeds $10.00 be factored in to the calculation? It's not specifically mentioned in Appendix and in reading the regulation, it's ambiguous.

Can anyone point me in the right direction?

Thank you.

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#2190840 - 08/28/18 03:55 PM Re: Reg DD Bonus and Advertisements jonv
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
The value of the bonus is not factored into the APY calculation.
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#2191439 - 08/31/18 05:35 PM Re: Reg DD Bonus and Advertisements jonv
St. Matthew Offline
New Poster
Joined: Jan 2018
Posts: 22
We seem to have danced around this a bit in this thread. When advertising a bonus for opening a variety of accounts, interest and non-interest bearing, each with their own APYs, what are my options to disclose the APY(s). I am trying not to let this disclosure get away from me and still be manageable. Must I disclose the APY for each eligible account, can I use one representative example, list the range of APYs (x-y%,) point them toward another source such a rate sheet or opening disclosures, or only say "it depends" ?

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#2191876 - 09/06/18 09:29 PM Re: Reg DD Bonus and Advertisements jonv
St. Matthew Offline
New Poster
Joined: Jan 2018
Posts: 22
I posted this going into a long weekend and didn't want it to get missed. Anyone have any input on how they have handled the scenario above when trying to disclose APYs on multiple accounts?

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