I'm reading TISA 230.2 definition of Bonus along with the commentary. I'm also looking at Mary Beth's Toasters, Teddy Bears and Other Freebies chart HERE and I seem to still have questions!

If we are paying an existing customer $5 or $10 for referring a friend who opens a checking account at our bank, is that considered a bonus and is it reportable as interest if the same customer receives more than $10 per calendar year?

Since the payment of a bonus has nothing to do with an existing customer's own account, I'm not sure if this will fall into the Bonus/Interest reportability category.

Any comments/questions to help me get this straight are appreciated! Thanks in advance!

If you pay me, because I referred a new customer, you have paid me taxable income. If I go over $600, you need to send me a 1099 MISC.

If you tell me, even via the payment, that my friend opened an account, you need Privacy releases in place from them, or you will have violated Reg. P by telling me they bank with you.

The IRS has a search function and you'll be able to get these forms and instruction. The INT is for Interest, MISC is Miscellaneous income and the OID is for discounts, NA in this discussion.

Here you are paying for a service, the referral, so it is an MISC reporting requirement. But that doesn't kick in until you get to $600.