I refused an offer last week. Two people had to go and sit and eat at a bar for no fee and reimbursement of only $25. I told them that isn't even enough to cover food, drink, tax, and tip. I was told "It's like a coupon for $25!"

Yesterday I saw a bunch at SQM. One said "if you can spend it, you can save it". The deal was you had to spend at least $50 at a breakfast restaurant "You can go with up to six people!", and be reimbursed $25. No fee, of course.

They also had a clothing shop where you needed to spend $100 and be reimbursed $40. Again, no fee.

And they have many, many parking shops that only reimburse 50% of the parking! No fee. The only other parking shops I've ever seen reimbursed 100% and paid a fee.

Is it coming to this? We pay them for a "coupon"?

If the shops don't get taken, MSCs will probably bonus it up to full reimbursement

Sadly, they may get taken and some MSCs will keep offering partial reimbursement if they can get away with it.

I am so blessed that I am out of the rat race and now, I can pick/choose my shops. The $25 bar fee is just fine with me and I'll take all that they post. I enjoy taking my friends or relatives out for a nice dinner and at least I get a bit of a reimbursement.

The report is minimum and there isn't a lot of narrative.

I shared a good evening with laughs (which some of us need) and walked out with a smile on my face. Just me, not including anyone else on this forum, the "coupon" was just a bonus.

Because hubby and I are both older and retired, my mystery shops are a way for us to get out and have a nice dinner, get car oil changes, etc. We live in a rural area, so there aren't always shops available. We enjoy the shops and have been introduced to some places we might not have gone to otherwise.

I guess my point is that, I don't mind the "coupon shops". In fact, we look at it as if we were treated to lunch or dinner. The reports can get a bit cumbersome, but still worth it to us.

What I have found I don't want to do again? Grocery shops. Way too much time invested in the store and in the report, for what is paid.

This is just me speaking. I am still relatively new (about 6 months now), so I may change my mind.

**By the way, I have learned so much form the posts I read here. I have not felt comfortable posting, since I am still so new. Thanks for all the insights!

I think this is one of the best things about mystery shopping -- there's something for everyone. If a shop isn't your cup of tea or not worth it to you, go do something else.

I was perfectly happy to treat my sister to a meal at a nice steakhouse with only a few bucks out of pocket after the reimbursement.

When nobody will do it for the terms offered, the client will have to change the offer. But some people love stuff like this.

However, I will say this, from a tax perspective, if all you do are reimbursement shops, you're not in business, you're a hobbyist. So don't try to write off your expenses for stuff like this. Consider it a coupon like you might get for sending in one of those customer feedback cards. But don't try to write off your mileage and other stuff against income that doesn't exist.

Different strokes for different folks. I love the $25 sit-at-the-bar shop. I only went $4.xx over when I went last week. We got the early dine meals, a glass of wine, a lemonade, and left the 15% tip. The report was pretty easy. I love to go out to eat. I trade my writing skills for dinner - fair trade to me! Otherwise, I would have paid out of pocket for the dinner, so I still view it as helping my bottom line.

Im okay with the coupon shops, as long as they have always been that way. I do not like it however when a shop that was full reimbursement goes that way. I also find when it is more coupon style, they have less restrictions on the amount of people you can take and so on...

I will take a coupon shop if it's at a place I either love or otherwise might go to. Generally the reports are fairly easy.

if you take too many coupon shops then the irs will
disallow all deductions because they will consider it
a hobby and not a business since running a business
is not about getting discounts at random restaurants
you would of went to anyway

Many establishments offer coupons or BOGO entree free deals and one does not have to submit a report or follow directions.

shoppergirl Wrote:
-------------------------------------------------------
> If the shops don't get taken, MSCs will probably
> bonus it up to full reimbursement
>
> Sadly, they may get taken and some MSCs will keep
> offering partial reimbursement if they can get
> away with it.


I think the way companies get away with it is when the shopper is not aware of the prices at the restaurant. It happened to me a couple of times. $60 sounds like reasonable reimbursement to accept the shop without a fee but then looking at the menu prices it becomes clear that $60 is not enough to cover all ordering requirements, plus parking and gas cost. Finally spending 2 hours writing a report, the time I could have spent making cash on another shop.

I look at mystery shopping as a way to keep expenses down. That's they way I explain it to people.

I trade my time to eat out, get my oil changed, take my son to living museums, aquariums, and movies. I can afford to do these because my money will come back to me.

Sallyctss that seems like a pennywise dollar foolish move.
A smarter move would be to do other shops that pay actual fees.
Then take that money and use it to go to the aquarium, movies etc
and not have to pay anything out of pocket or write a report after
visiting a 'fun' place and can just enjoy yourself.

techman01 Wrote:
-------------------------------------------------------
> Sallyctss that seems like a pennywise dollar
> foolish move.
> A smarter move would be to do other shops that pay
> actual fees.
> Then take that money and use it to go to the
> aquarium, movies etc
> and not have to pay anything out of pocket or
> write a report after
> visiting a 'fun' place and can just enjoy
> yourself.


There's absolutely NOTHING pennywise & pound foolish about Sally's post.

If you shop for reimbursement only, you won't have ANY taxable income; you could do a million dollars worth a year and not receive one single solitary 1099; you won't NEED any deductions against income, because you won't be generating any taxable income.

She's using her shopping skills to heighten her standard of living.

I, too, cannot afford to take my kids and grandkids to a museum, water park, zoo, special events, etc. But I LOVE to treat them to stuff like that. If I get tickets worth over $100 that covers the
cost of getting in, I can treat the kids! Since I'm not generating taxable income (unless someone
tips the IRS to what amounts to bartering, in which case the MSC's would have to start paying us
REAL money instead of the nickels & dimes they give us!), I don't have to EARN $150 in pre-tax
dollars to be able to treat the kids!

Perhaps there's someone else here who's pennywise and pound foolish, but it ain't Sally!

cease

Of course you may receive 1099s. Some companies send them based on the amount they paid you regardless if it was fees or reimbursement. So you need to be prepared to list it as income/expenses. There is also a good chance it will keep your "business" just a hobby in their eyes so you don't want to deduct mileage or any other standard business expenses.

I also think the IRS might find an issue with being reimbursed a million dollars worth of food and services.

ceasesmith Wrote:
-------------------------------------------------------
> techman01 Wrote:
> --------------------------------------------------
> -----
> > Sallyctss that seems like a pennywise dollar
> > foolish move.
> > A smarter move would be to do other shops that
> pay
> > actual fees.
> > Then take that money and use it to go to the
> > aquarium, movies etc
> > and not have to pay anything out of pocket or
> > write a report after
> > visiting a 'fun' place and can just enjoy
> > yourself.
>
>
> There's absolutely NOTHING pennywise & pound
> foolish about Sally's post.
>
> If you shop for reimbursement only, you won't have
> ANY taxable income; you could do a million dollars
> worth a year and not receive one single solitary
> 1099; you won't NEED any deductions against
> income, because you won't be generating any
> taxable income.
>
> She's using her shopping skills to heighten her
> standard of living.
>
> I, too, cannot afford to take my kids and
> grandkids to a museum, water park, zoo, special
> events, etc. But I LOVE to treat them to stuff
> like that. If I get tickets worth over $100 that
> covers the
> cost of getting in, I can treat the kids! Since
> I'm not generating taxable income (unless someone
> tips the IRS to what amounts to bartering, in
> which case the MSC's would have to start paying
> us
> REAL money instead of the nickels & dimes they
> give us!), I don't have to EARN $150 in pre-tax
> dollars to be able to treat the kids!
>
> Perhaps there's someone else here who's pennywise
> and pound foolish, but it ain't Sally!
>
> cease

I COMPLETELY agree with you and Sallyctss!

That's actually almost all I do are reimbursement shops (with HIGH reimbursements). My husband and I bought a house almost a year ago, so we have been pinching pennies to build our savings back up from our large cash deposit. Because of mystery shopping this last year, I have been able to save thousands of dollars on things we typically would like to do. We spent almost nothing on our wedding anniversary because I picked up a bunch of fine dining restaurants (some with small fees or bonuses attached). We get to eat out at nice restaurants at least 1-2x a week. Ya, it's not so good for the bellies lol but we've learned to portion our food and take home leftovers, which saves money on other meals as well.

We got out carpet cleaned for free along with a hefty payment and bonus. We got to go on a 3 night getaway with a HUGE added free bonus. We get to go watch movies for free, but we are also signed up for Movie Previews which is similar but without a report and just a small survey along with another free movie ticket for going.

I've had numerous free facials and massages. Free gifts for birthdays. Free high end facial products for full reimbursements. Lots of "free" (full reimbursement) products.

I am one of the shoppers that does the reimbursement shops because it allows me to save my money and be able to get things or eat at places I wouldn't normally allow in my budget. I have learned to weed out the "coupon" shops depending on how badly I need to go to that location anyway. For example, I needed something at Annas Linens and a shop was $10 reim only. I was already going there and the report is easy enough, so why not? Now would I go out of my way to pick that up, no.

I always get WAY excited when there is a small fee added on to those shops, even if it's $10! Since November, I have been reimbursed about $3,000 for those shops and have only actually "made" about $900 in fees. Works for me!! It's my "hobby"

Oh I forgot to mention! I always use my AMEX rewards card to pay for my reimbursement shops. I have earned LOTS of rewards this last year by doing so!! I highly recommend it.



Edited 1 time(s). Last edit at 04/14/2014 04:27PM by NotSoSecretShopper.

"Works for me!! It's my hobby."

If MS is your hobby then naturally reimbursement shops can work well for you and obviously you don't mind not having mileage or business deductions to offset the tax bill for the $900. It strikes me that Sally is an IC scheduler and it may work out better if her mystery shopping was also treated like a business so she can get the mileage deduction, something probably not available to her as a scheduler and usually the single biggest one we all have.

Only about 25% of the reimbursement shops I do have small fees ($5-10). The $900 didn't come from those, well about $200 did. The rest are from the fee only shops I do. I didn't mention those because I was gloating about the "coupon" reimbursement shops I pick up. Oops. Probably should've said that!

What difference does that make? Your income from fees is only about 25% of your combined income. If you are focusing on reimbursement shops and declaring your mystery shopping a hobby, AFAIK you aren't going to be able to take business deductions.

I don't think I'm getting my point across clearly or you are misunderstanding it.

Not a big deal. Never mind.

Then what is your point? I understand you like the reimbursement shops as lifestyle enhancements which is what a hobby should be.

NotSoSecretShopper what you mentioned in your post is not what
I was describing. There is a difference between going to a restaurant
and getting the full 150 dollar check reimbursed and only getting a
25 dollar discount on that 150 dollar check because 25 is the max they
are reimbursing. By the word "coupons" we are talking about discounts
not free meals or events.

As to what LisaSTL is saying, she is right. If you made 4,000 in compensation
last year and 3100 of it was reimbursements, and you have 900 in shop fees
as you stated, then that adds to your income tax bill since you can't deduct
it as a business because it is considered a hobby as your reimbursement shops
exceed the fees then it shows the irs you dont have an intention of running it
as a real business.

No, she's quite right.

The 1099 shows earned income, for which she can and may deduct expenses. The fact that reimbursements is a higher dollar amount is irrelevant; when I was in sales, my expense report reimbursement was regularly higher than my paycheck. But my expense reimbursement was NEVER taxable income.

But you are right in that constantly referring to it as a "hobby" is a really, really bad idea, as income
from hobbies IS taxed, without any business deductions allowed.

The reason for this is that allowing deductions for hobby expenses would open a whole 'nuther can
of worms. Everybody has a hobby; everybody would take deductions for indulging in their hobbies!

However, I never knew anyone, anywhere, who received a 1099 for "hobby"; the fact we get 1099s
means we ARE in business.

cease

Since you didn't mention any clients, do you mind sharing the name of the company, so as I stay away from it?




mistry Wrote:
-------------------------------------------------------
> I refused an offer last week. Two people had to
> go and sit and eat at a bar for no fee and
> reimbursement of only $25. I told them that isn't
> even enough to cover food, drink, tax, and tip. I
> was told "It's like a coupon for $25!"
>
> Yesterday I saw a bunch at SQM. One said "if you
> can spend it, you can save it". The deal was you
> had to spend at least $50 at a breakfast
> restaurant "You can go with up to six people!",
> and be reimbursed $25. No fee, of course.
>
> They also had a clothing shop where you needed to
> spend $100 and be reimbursed $40. Again, no fee.
>
> And they have many, many parking shops that only
> reimburse 50% of the parking! No fee. The only
> other parking shops I've ever seen reimbursed 100%
> and paid a fee.
>
> Is it coming to this? We pay them for a "coupon"?

ceasesmith Wrote:
-------------------------------------------------------
> No, she's quite right.
>
> The 1099 shows earned income, for which she can
> and may deduct expenses. The fact that
> reimbursements is a higher dollar amount is
> irrelevant; when I was in sales, my expense report
> reimbursement was regularly higher than my
> paycheck. But my expense reimbursement was NEVER
> taxable income.
>
> But you are right in that constantly referring to
> it as a "hobby" is a really, really bad idea, as
> income
> from hobbies IS taxed, without any business
> deductions allowed.
>
> The reason for this is that allowing deductions
> for hobby expenses would open a whole 'nuther can
> of worms. Everybody has a hobby; everybody would
> take deductions for indulging in their hobbies!
>
> However, I never knew anyone, anywhere, who
> received a 1099 for "hobby"; the fact we get
> 1099s
> means we ARE in business.
>
> cease


Wrong, cease. You are talking about something entirely different. Being in a sales job has nothing do with someone who is running their own business. If you earn 900 dollars in income and 4000 in reimbursments the irs will see it as you are not in business to earn a profit and classify it as a hobby and disallow deductions. The shopper even agrees that it is a hobby of theirs. Also as far as your 1099 is concerned, many msc's include reimbursements on the 1099 and it is your responsibility to deduct the reimbursement compensation off your taxes.

techman01 Wrote:
-------------------------------------------------------
> ceasesmith Wrote:
> --------------------------------------------------
> -----
> > No, she's quite right.
> >
> > The 1099 shows earned income, for which she can
> > and may deduct expenses. The fact that
> > reimbursements is a higher dollar amount is
> > irrelevant; when I was in sales, my expense
> report
> > reimbursement was regularly higher than my
> > paycheck. But my expense reimbursement was
> NEVER
> > taxable income.
> >
> > But you are right in that constantly referring
> to
> > it as a "hobby" is a really, really bad idea,
> as
> > income
> > from hobbies IS taxed, without any business
> > deductions allowed.
> >
> > The reason for this is that allowing deductions
> > for hobby expenses would open a whole 'nuther
> can
> > of worms. Everybody has a hobby; everybody
> would
> > take deductions for indulging in their hobbies!
> >
> > However, I never knew anyone, anywhere, who
> > received a 1099 for "hobby"; the fact we get
> > 1099s
> > means we ARE in business.
> >
> > cease
>
>
> Wrong, cease. You are talking about something
> entirely different. Being in a sales job has
> nothing do with someone who is running their own
> business. If you earn 900 dollars in income and
> 4000 in reimbursments the irs will see it as you
> are not in business to earn a profit and classify
> it as a hobby and disallow deductions. The shopper
> even agrees that it is a hobby of theirs. Also as
> far as your 1099 is concerned, many msc's include
> reimbursements on the 1099 and it is your
> responsibility to deduct the reimbursement
> compensation off your taxes.

What if you do high-reimbursement jobs to make a profit? I've heard that there are hotel jobs out there that pay decent money.

What about those shops where you buy glasses and mail them back to the company? There, you have massive reimbursements compared to the fee, on a shop that no one would do except for the money. (I assume that the people who buy prescription glasses that they don't get to keep, just for the fun of it, are very few and far between.)

The poster specifically said she tends to take shops that enhance her lifestyle rather than for fees. She also stated this was a hobby. That pretty much says it all.

The eyeglass shops in particular would not be for any reason other than money because you actually receive nothing other than the fee for your time. It might be different if you were keeping those expensive glasses. I had to travel for a week long training and have had to travel several times for some ongoing audits. I don't worry that my travel reimbursements and per diem add up to more than my fee. The travel was a required part of the "job" rather than for pleasure.

LisaSTL Wrote:
-------------------------------------------------------
> The poster specifically said she tends to take
> shops that enhance her lifestyle rather than for
> fees. She also stated this was a hobby. That
> pretty much says it all.
>
> The eyeglass shops in particular would not be for
> any reason other than money because you actually
> receive nothing other than the fee for your time.
> It might be different if you were keeping those
> expensive glasses. I had to travel for a week long
> training and have had to travel several times for
> some ongoing audits. I don't worry that my travel
> reimbursements and per diem add up to more than my
> fee. The travel was a required part of the "job"
> rather than for pleasure.

Right. That's what I meant. But, I actually am curious about how the IRS would view the numbers.

Techman1 said:

>If you earn 900 dollars in income and
> 4000 in reimbursments the irs will see it as you
> are not in business to earn a profit and classify
> it as a hobby and disallow deductions.

Is this statement correct, not with regards to the original poster, but overall? Obviously, if you took a lot of eyeglass shops, or other shops of that sort, you would end up with a fee/reimbursement ratio worse than 1 to 4. Would that wave red flags in the IRS system? When you send in your tax return, it's going to show the raw numbers. They would have to be deep into an audit before you had a chance to explain what it was all about.

(For the record, my fee/reimbursement ration is running about 2 to 1, so far. I'm no hobbyist! I'm in it for the money. Trying to be, at least.)

Edited 1 time(s). Last edit at 04/14/2014 09:23PM by Ishmael.

What the IRS says is you have to show a PROFIT for a certain number of years out of so many years (I think it's at least 3 out of 5 years) to be a business.

If she WANTS to declare the $900 as fully taxable "hobby" interest, she certainly may do so.

It's foolish to pay tax if you don't have to.

My reimbursements run about 10% of my MS income. It's shown on my 1099's in a separate place. No way do I pay taxes on the reimbursement portion.

In fact, when my reimbursement doesn't cover my actual disbursement, the difference is a tax-deductible expense -- if and only if my contemporary records are adequate.

If you go to a tax pro, you may find that they are also unfamiliar with this area of tax law. It still remains the best thing to do, though.

Taking tax advice from a stranger on a public forum is like crossing a busy street blindfolded and
with ear-plugs in.

Oops, I took too long a nap -- gotta go shop!



cease

Getting back to the original idea of this post...i guess I can finally say something positive about the shopping environment in Los Angeles where I live. I keep mentioning the lack of bonuses and the travel time, hassle and expense outweighing the return on many shops. But on this subject..there are so many coupons for really good restaurant meals since 2008 and you can use restaurant.com or a 2/1 coupon book. I cannot think of any reason in this town that I would sign up for a coupon shop to get $25 off a meal. I have never seen them so perhaps they only require you to rate the meal on a scale of 1-5 with no narrative, but no I would not accept those shops and have to restrict myself to dining on the appointed day at the required time period, purchasing additional food I would not normally purchase such as appetizers and desserts with a meal and most likely end up spending at least the coupon amount more than I would spend to have a meal I wanted. To top it off having to be "on" during the entire meal looking for timing, words, greetings etc and then go home and have to write it up.