Are bank account bonuses taxable?

Updated November 5, 2026 · Offer data last verified 2026-11-05 · Not financial or tax advice.

Short answer: yes, generally. Cash bonuses for opening a checking or savings account are typically treated as interest income, reported on Form 1099-INT and taxed at your ordinary income rate. Here's what official sources say (read 2026-10-31).

What banks say

Chase's checking offer terms state the bonus "is considered interest and will be reported on IRS Form 1099-INT (or Form 1042-S, if applicable)." Check the terms of any bonus you take; most banks say something similar.

What the IRS says

You report all interest, form or no form. IRS Topic 403: "You must report all taxable and tax-exempt interest on your federal income tax return, even if you don't receive a Form 1099-INT."
The $10 threshold is for the bank, not you. Per the Form 1099-INT instructions, payers file a 1099-INT for interest of at least $10. Below that you may not get a form, but the income is still reportable.
Gifts for opening an account. IRS Publication 550 says noncash gifts or services for opening an account or making deposits may be reported as interest. For deposits under $5,000, gifts valued over $10 must be reported as interest; for deposits of $5,000 or more, over $20. Value is the bank's cost.

Example (our math, illustrative only)

A $400 bonus taxed at a 22% federal bracket costs $88 in federal tax, leaving $312 before any state tax. Your rate depends on your situation.

Brokerage and credit card bonuses are different

Brokerage cash bonuses are often reported on a 1099-MISC or 1099-INT depending on the firm; see are brokerage bonuses taxable? Credit card spending bonuses are a separate topic; ask a tax professional about your situation.

Tips

Keep a list of every bonus you earned in the year, in case a form goes missing.
Joint accounts: the 1099-INT usually goes to the primary holder's SSN.
Compare offers net of tax using our real return guide.

General information only. This isn't financial or tax advice. Offers change or end without notice, and the official terms always govern. Confirm everything on the provider's page before you act. See our disclaimer.

Sources read 2026-10-31: IRS Topic 403, Instructions for Form 1099-INT, IRS Publication 550, Chase offer terms.

FAQ

Do I pay taxes on a bank sign-up bonus?

Generally yes. Banks typically treat it as interest and report it on Form 1099-INT; it's taxed as ordinary income.

What if I didn't get a 1099-INT?

The IRS says you must report all interest even if you don't receive a 1099-INT. Banks generally only file one for $10 or more.

Are gifts for opening an account taxable?

IRS Publication 550 says noncash gifts may be reported as interest: over $10 for deposits under $5,000, over $20 for deposits of $5,000 or more.