- Is this considered a contribution subject to things like yearly Roth contribution limits?
- Is there any special tax treatment? Such as the cash bonus in regular IRA becoming after-tax dollars?
Background: I recently moved a traditional IRA and a Roth IRA from my previous brokerage to Merrill Lynch. The offer included a cash bonus in both IRAs, deposited after 90 days.
The transactions in my Merrill account have a description "Other Income" and the Type field is "Dividends/Interest". To me, this implies no 1099's would be generated since these look like dividends in tax-deferred accounts.
My interweb searching only got me one useful hit at https://www.doctorofcredit.com/merrill-edge-brokerage-up-to-900-cash-bonus-for-moving-over-your-investments/ buried in the comments was: "At Merrill Edge, and most brokerages, a bonus paid into an IRA is like investment returns, not a contribution, and not taxable (apart from that for a Trad IRA you pay tax when you withdraw, but that’s just like any other returns within Trad IRA)." But this is some random internet person, not the financial wizards of Stack Exchange.