Yes, this is a peculiar situation where the IRS does not offer clear guidance. As a tax professional, I would advise reporting the $11,200 this year as taxable income and defer the trip until you are able to take advantage of the benefit, since they haven't released it to you yet.
Before you do anything though, I would suggest trying to contact the airline to see if a 1099-MISC will be issued for the airmiles. Here is how you should report the airmiles.
- Click Federal > Wages & Income>all income>
- Go to the last selection, Miscellaneous Income and click Start
- Go to the last option, Other reportable income and click Start
- When it asks, "Any other reportable income?" say yes and then type in a description and the amount to report it on your tax return.
- For the description, record airmiles awarded by airlines, no 1099-MISC, then the amount.
- If you receive a 1099-MISC, you can describe this as 1099-MISC received for airmiles awarded by airlines. Either way, you are covered because you reported the amount of the airmiles received as taxable income.
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