Tax On Your AMEX Points!
 

My auditor has just informed me that I will be paying a taxable benefit on my AMEX points!!!

I primarily use my AMEX for business and end up getting a free vacation every year out of the deal. NOW I have to pay tax on the dollar value of the points.

I was always under the impression that this was a "grey area" for the taxman but nope. I have to pay tax on all the points I have cashed in. Over a million points!

You get a special tax form from AMEX which declares the value of the used points.
It is taxed like gifts.

If your business uses the points, you should consider the points as a refund. After all, your company paid for the points. Why pay taxes for something you paid for?

BUT, if you use the points for personal use, you do need to pay a gift tax on them.

You can take me on vacation and Write it off! I Don;t cuddle though

thats no good

Is there a way you can claim the use of those points as a business expense? If not, then unfortunately you benefited from something the company earnt which is taxable. I hate it as much as you do, thankfully I've never cashed out any reward points (yet). I do have a lot of points stored in the bank so to say though :)

WG

:321GFY to AMEX. $400 a year for some overpriced shit. At least I feel all studly pulling out that Platinum beauty for purchases. I'm convinced girls get moist when they see it. :thumbsup

Dude I feel your pain, I seriously do LOL!!

DH

Yeah it's always been considered a grey area in business. My guy said that most people only spend 1K per month or less so they don't sweat the points. I spend much much more than that so my points add up fast. All my hosting, travel hardware, software etc get charged to my AMEX monthly.

Now I have to pay about $6000 for the benefit those points awarded me.

Let this be a lesson to the rest of you. Use your points for business purchases and you will be ok.

Even though you are a tax evading criminal I still care for you.

- J

Damn, does Amex report to the CCRA when you cash them out? During my audit, it never came up, although I didn't redeem any points so I guess I'm safe for now. I'm sure if he saw my visa statements and my total points dropped he would have noticed that. But so long as you use your reward points for business use it would be fine or would that be considered taxable income for your company (as opposed to a personal benefit in your case)?

WG

He just spotted them getting cashed out on my monthly statements. I cash them out every year so they wind up on the statements.

I love my Amex and Citibank points! I think I am a point Whore :)

We cash in well over 2 million a year and I am having our ups rep work on charging our weekly bill to a company card also.. Back and forth on that one as ups didn't want to have to cover the 2% merchant fee :)

Fuckers!

You don't pay taxes on something you paid for. What part of that don't you understand? -lol

::laughs and points::

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