If you sign up for the new Chase Sapphire Banking checking account, you’ll get 60,000 bonus Chase Ultimate Rewards points.
But you’ll also get something that doesn’t come with your other points-and-miles-earning activities: taxable interest income.
The Chase Sapphire Banking account requires you to have $75,000 in qualifying deposits. Whether it’s in savings accounts, money markets, CDs or other investment products — or a combination — that money you deposited will pay you interest, and you’re going to have to pay taxes on it.
Who gets a 1099-INT?
You can expect a 1099-INT from the government only if your interest adds up to $10 or more before the end of the year. Interest on savings accounts starts at just 0.01% effective as of 1/22/19. Interest rates are variable and subject to change.
If you get the 1099-INT, you’ll enter the interest income on that form onto line 8a of a 1040 or 1040A, or on line 2 of Form 1040EZ.
» Learn more: What is a 1099 tax form? How it works and what to do
Who doesn’t get a 1099-INT?
If you don’t get a 1099-INT from the government, it’s because you earned less than $10 before year’s end. But that doesn’t mean you’re off the hook. You still have to report those earnings.
That’s because the laws that say banks must report your income over $10 don’t have a corresponding $10 figure attached to the income you must report. Even if your interest earnings total just 50 cents, you’re supposed to document it as income on your tax return. Less than 50 cents, you don’t have to worry about because the government lets you round to the nearest dollar. The nearest dollar to 49 cents is zero.
Tax hassles and penalties can take the fun right out of getting those 60,000 bonus points, so be sure to report that interest income.
How to maximize your rewardsYou want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2019, including those best for:
- Airline miles and a large bonus: The Chase Sapphire Preferred® Card
- No annual fee: The Wells Fargo Propel American Express® Card
- Flat-rate rewards with no annual fee: The Bank of America® Travel Rewards credit card
- Premium travel rewards: The Chase Sapphire Reserve®
- Luxury perks: The Platinum Card® from American Express
- Business travelers: The Ink Business Preferred℠ Credit Card
Planning a trip? Check out these articles for more inspiration and advice:
Chase Sapphire Banking: A checking account that rewards like a travel credit card with a 60K-point offer
9 easy ways to earn travel rewards you’ll actually use
How to find the best travel credit card