Skip to content

Business Account Referral

Answered by: 

Question: 
We want to increase our market share of commercial accounts. If we pay a referral fee for a business deposit account, are there compliance restrictions?
Answer: 

Just as with a consumer account, tax reporting burdens may apply depending on how much you will pay and how much the person being paid can earn. At $600, a 1099-MISC will be required and you'll have to track the payments to know that you are or are not at that limit.

The common issue with these programs is privacy, and the necessity of some waiver on the part of the new customer. When you pay a person sending in the referral for an account that is opened, you are disclosing that a relationship now exists and that can violate Reg. P. A business is not protected as a consumer is, so you have avoided that limitation. (Please ensure your state laws don't prohibit this.)

First published on BankersOnline.com 9/06/10

First published on 09/06/2010

Filed under: 
Filed under compliance as: 
Filed under operations as: 

Banker Store View All

From training, policies, forms, and publications, to office products and occasional gifts, it’s available here:

Banker Store

hot right now

image description

Looking for effective, convenient training on a particular subject?

BOL Learning Connect offers more than 200 courses ON-DEMAND or on CD ROM from AML to Reg Z and every topic in between.

Search Topics