Several readers have sent me a Los Angeles Times piece about Citibank’s reporting of mileage signup bonuses for bank (not credit card accounts) beings reported to the IRS on 1099 forms. I’ve written about this sisue several times in the past, and I have a new post up on Conde Nast‘s Daily Traveler.
I make the point that just because something is reported to the IRS doesn’t mean you have to agree that it is taxable or agree with the valuation of the entity sending you that tax form. The IRS has said in the past that not paying taxes on miles wouldn’t generate an enforcement action, and I argue that the value of the miles is likely lower than that being reported by Citi. In the Daily Traveler post, I share how to dispute the valuation and reduce your tax liability, though of course I know better than to offer specific tax advice for individual situations that I don’t know about fully (and I am not a CPA< just someone who doesn't want to pay taxes on his miles!)