Can anyone confirm if the mileage earned is indeed tax-free? Ideally, I'd love to hear from someone who earned BankDirect miles in 2009 and who got a 1099 for their interest income. Did BankDirect report the equivalent value of the miles as interest income somehow?

It seems like the miles are de facto interest income but if the bank isn't reporting it that way, and the IRS isn't complaining, then who am I to make a fuss?