I added a blogroll to this website about a week ago. It lists several blogs that I often read. I find the blogroll to be a handy tool for myself because it let me use my own site as the main hub to open up these blogs on my browser.
As I was going through these blogs a couple days ago, I was a little surprised to find that three of these blogs were writing about the same topic, the Capital One 360 Financial Independence Day Promotion.
They are probably getting compensated if anyone sign up for an account through the links on their post. This makes me wonder if Capital One 360 is aggressively reaching out to bloggers to advertise their promotion. Or maybe these bloggers got an email about the promotion because they have an account with Capital One (I did, I have a savings account with Capital One), and the promotion is attractive enough that they independently decided to blog about it.
The nitty gritty of the promotion are covered very well in these posts, so there is no need for me to go over them here. The promotion ends on July 3rd (which is tomorrow as of this writing), but if you do sign up for a new (taxable) account or have done so already, remember that you have to pay taxes on the promotion bonus.
The bonus is not interest, so it will not show up on a 1099-INT. You might get a separate 1099-MISC instead. It is also possible that you won’t get a 1099 at all. (It happens. I have signed up for a Forex account solely for the purpose of getting a promotion bonus, but the 1099 never came.) However, not getting a 1099 doesn’t mean that you don’t have to report the bonus income.
You will have to report the promotion bonus under other income:
The bonus will be taxed at your marginal rate. Oh right, and your state probably wants a piece of your bonus too.
Am I trying to discourage you from opening an account and taking the bonus? No. If someone comes along and present you with a money earning opportunity, would you refuse on the basis that you will have to pay taxes on the money you received?
The 360 Savings and 360 Checking accounts offer very competitive interest rates. It is a great place to put a sum of money such as an emergency fund. If you do decide to take advantage of the promotion, please do not forget to report the bonus on your 2014 tax return.