how critical is "...to the account" in the phrase "interest paid or credited to the account"?

a literal reading would mean that a 1099INT is not triggered if the proverbial 'toaster' is given as a promo at account opening as it cannot be deposited into the account.

You wanna tell that to the IRS?

haha no, i just want to see how they are defining "to the account" because, without definition or clarification, i am stubborn enough to do just that!

We sent a separate 1099 to the account holders at the end of the year for what we paid for the item plus shipping plus tax. We warned the customers when we originally gave them the gift.

Ron,


Start reading on the bottom of page 112 (the IRB page number):

http://www.irs.gov/pub/irs-irbs/irb00-28.pdf

Thanks, Randy!

I just wish they'd write the 1099INT instructions a bit more clearly so I don't think that I've found a ball to run with. The revenue ruling simply restates the general concept of taxation which is hard to argue with.