Chase Rewards

If you have a Chase Rewards credit card, April - June you can get 5% cash back at gas stations and home improvement stores.

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope

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It depends on *which* Chase Rewards card you have....

Hard work builds character and homework is good for your soul.
@MFJohnston wrote:

It depends on *which* Chase Rewards card you have....

Chase Freedom and Freedom Flex

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 31 year old male and willing to travel!
... But not Chase Freedom Unlimited...

Hard work builds character and homework is good for your soul.
@MFJohnston wrote:

... But not Chase Freedom Unlimited...

No. Unlimited’s there more for the regular purchases like dining and drug store (3%) and everything else (1.5%) IF you don’t have a general purchase card like Citi Double Cash (2%) or Fidelity (2%) or even better, 2.63% for Bank of America if you have $100k in total assets with them.

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 31 year old male and willing to travel!
Correct! I have Chase Flex World Elite.

@Tarantado wrote:

@MFJohnston wrote:

It depends on *which* Chase Rewards card you have....

Chase Freedom and Freedom Flex

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
How timely. I just activated in one click next quarter's rewards yesterday. Funny to see it here.

FYI, AARP's credit card, also from Chase, always gives 3% back on gas and restaurants. My AARP membership number is on my CC, so I need not carry two cards. (There are discounts, such as 15% off entire order at Denny's, through AARP.
CA Senior, I checked my cash rewards amount and saw that next quarter rewards were available to activate. I was surprised when I saw the clients I shop.

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
Actually B of A is better than that. If you have 50,000 in your acct for a 3 mos period each year you can get a 50% boost on your reward, if you have 100,000 you get a 75% boost. Every month you can choose which of the 3% categories you want that month which will then give you 4.5% cash back all month. Those categories include dining, travel, internet, home improvement, and a few others. When I was doing a lot of msc dining back in the day pre covid I kept it on dining and always got 4.5% back. Then two months ago when I did my long trek to Texas and back I set it to travel and got 4.5% on hotels, airlines, any sort of transportation. And the B of A card you also get 2% at costco or sams always so if you can keep 50,000 in your acct for 3 mos a year you can get 3% back at costco which is better than the costco card at 2%. That money can be in a linked Merril Edge acct so if you have an IRA or whatever as an investment it can be in Merril and satisfy the minimum that way. You can swtich anytime once each month so if you are buying an airline ticket on June 4th you can make your choice travel on the last day in May, get your ticket paid for and then on June 5th you can switch to restaurants if you plan to eat out the rest of the month.at your destination. So it is quite flexible.

@Tarantado wrote:

@MFJohnston wrote:

... But not Chase Freedom Unlimited...

No. Unlimited’s there more for the regular purchases like dining and drug store (3%) and everything else (1.5%) IF you don’t have a general purchase card like Citi Double Cash (2%) or Fidelity (2%) or even better, 2.63% for Bank of America if you have $100k in total assets with them.
50,000 what in an account for 3 months?

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
@HonnyBrown wrote:

50,000 what in an account for 3 months?
$50,000 combined in any accounts with Bank of America or Merrill Edge.

And if you get up to $100k the 3% Cash Rewards card becomes 5.25%. And you can get more than one of the Cash Rewards card, so you can have cards with different categories. I always have one set for dining, so I get 5.25% back on all my restaurant shops. Also gets you 3.5% back at supermarkets and warehouse clubs like Costco along with the 3/5.25% category.

Edited 2 time(s). Last edit at 03/20/2021 07:11AM by MisterBill.
Okay. It's only beneficial if one has a mortgage or investments linked.

I like Chase Flex because I don't have to have accounts linked to take advantage of the rewards.

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
@HonnyBrown wrote:

Okay. It's only beneficial if one has a mortgage or investments linked.

I like Chase Flex because I don't have to have accounts linked to take advantage of the rewards.
It's still useful without the 50-75% kicker, but that's what makes it most lucrative. 3% back on your choice of travel, dining, online shopping, gas, etc. isn't bad. And you get it all the time, not just when the quarterly category comes around, unless you switch it to something else.

I have three Chase Freedom cards, but I only use them for the 5% categories. Having gas as the 5% next quarter means I can switch one of my BofA Cash Rewards cards to something else, probably travel.

Edited 2 time(s). Last edit at 03/20/2021 04:17PM by MisterBill.
I just read an article about a guy who made $300,000 in one year on rewards. Did things like buy those cards you can cash. Although how somebody with, or earning, that kind of money has TIME to go to Walgreens and buy $200 in gift cards every day kinda boggles my mind.

IRS said it was taxable income.

I think that fight will drag on for years...and years...and years!
Cease, did they mean the rewards you get from your credit card percent back are taxable? What about the free meals I am getting for my birthday this month? Do I have to report those too? Maybe I will save one of the tortillas I get for my bday meal tonite and send it to the IRS with my tax return in payment for that meal.

@ceasesmith wrote:

I just read an article about a guy who made $300,000 in one year on rewards. Did things like buy those cards you can cash. Although how somebody with, or earning, that kind of money has TIME to go to Walgreens and buy $200 in gift cards every day kinda boggles my mind.

IRS said it was taxable income.

I think that fight will drag on for years...and years...and years!
Yes, I agree about having to have a linked acct. For BofA a mortgage does not help. My Bof A account pays essentially zero interest right now. I almost cancelled my card last year due to not thinking it was worth the cash back at the expense of $50000 in my acct at .00001 % interest but then took the plunge and opened a Merrill acct where I was able to find very few, but some, investments that paid a decent enough interest.

@HonnyBrown wrote:

Okay. It's only beneficial if one has a mortgage or investments linked.

I like Chase Flex because I don't have to have accounts linked to take advantage of the rewards.
LOL...That's awesome!

@sandyf wrote:

Maybe I will save one of the tortillas I get for my bday meal tonite and send it to the IRS with my tax return in payment for that meal.

Kim
@sandyf wrote:

Yes, I agree about having to have a linked acct. For BofA a mortgage does not help. My Bof A account pays essentially zero interest right now. I almost cancelled my card last year due to not thinking it was worth the cash back at the expense of $50000 in my acct at .00001 % interest but then took the plunge and opened a Merrill acct where I was able to find very few, but some, investments that paid a decent enough interest.
Yes, you don't want to keep much cash in your BofA accounts. But if you have some investments elsewhere, you can often get a transfer bonus to move them to Merrill Edge, and then quality for the higher credit card rebates. You also get other bonuses like ATM rebates, reduced/waived fees and a free safe deposit box.

And of course at the moment finding anything short term that pays much of any interest is hard to find.

Edited 1 time(s). Last edit at 03/20/2021 11:19PM by MisterBill.
I believe the article was in Forbes.

The upshot was that the law doesn't really address it; IRS wanted to tax it because it really was $300,000 of income. The man who did it says the law doesn't call it taxable income.

Interesting article, though. I don't think your rewards -- even if several thousand dollars -- will catch the IRS' eye; I mean, most of us are under the radar, so to speak.

If they want to make it taxable, the companies would have to start issuing 1099s miscellaneous.

smiling smiley

It's called "manufactured spending", deliberately earning money on reward cards:
[www.fool.com]

@sandyf wrote:

Cease, did they mean the rewards you get from your credit card percent back are taxable? What about the free meals I am getting for my birthday this month? Do I have to report those too? Maybe I will save one of the tortillas I get for my bday meal tonite and send it to the IRS with my tax return in payment for that meal.

@ceasesmith wrote:

I just read an article about a guy who made $300,000 in one year on rewards. Did things like buy those cards you can cash. Although how somebody with, or earning, that kind of money has TIME to go to Walgreens and buy $200 in gift cards every day kinda boggles my mind.

IRS said it was taxable income.

I think that fight will drag on for years...and years...and years!


Edited 1 time(s). Last edit at 03/21/2021 05:13AM by ceasesmith.
I saw that article on a news feed when I swiped right from my Android home screen. I didn't read it. I thought, "How much did he have to spend to earn that much."

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
My Flex card is my only credit card. Since I use it for mystery shopping, the reimbursements pay the statement balance so I pay no interest

This quarter's 5% was cell phone bills, so I took advantage of that. It was paid off the same day.

The regular 3% back for dining is nice considering how many burger shops I do.

@MisterBill wrote:

It's still useful without the 50-75% kicker, but that's what makes it most lucrative. 3% back on your choice of travel, dining, online shopping, gas, etc. isn't bad. And you get it all the time, not just when the quarterly category comes around, unless you switch it to something else.

I have three Chase Freedom cards, but I only use them for the 5% categories. Having gas as the 5% next quarter means I can switch one of my BofA Cash Rewards cards to something else, probably travel.

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
Thanks for clarification Ceasesmith. My feeling about the rewards I get has always been closer to finding a better price for something or a sale rather than income. So will they someday decide to tax the savings you had if you bought something on sale?
This could be a big source of revenue for the IRS if they considered such things that mystery shoppers get aside from cash back from cards, things like free hotel nights, airline points etc. Don't tell them I suggested that.
I really don't think so. They called it "manufactured" because the card holder deliberately and systematically used the cards to "make" (i.e., in the IRS' eyes, "earn" ) money.

$300,000 ain't chump change.

Unless, of course, you're Bill or Jeff!
So, let's go down the rabbit hole that Cease pointed out. If a rebate on a credit card is income, I would think that if you buy something for $100, fill out a form online, and take a photo of the receipt and UPC and submit them, and 3 months later they send you $15 as a rebate, that would be income also. Want instant gratification? Go to the supermarket. Buy 5 cartons of soda for $15. The register shows $15 owed. Let them scan your loyalty card, and magically, $5 comes off the bill. That would also be income. The issue of the value of airline miles (loyalty points) being taxable has been around for decades. When would it be taxable? When you earn them? If so, when they expire, do I get a rebate? When I use them? If so, is the value the cost of a full-fare ticket that the miles replaced? A can of wriggling worms.

Shopping Southeast Pennsylvania, Delaware above the canal, and southwestern NJ since 2008
@myst4au wrote:

So, let's go down the rabbit hole that Cease pointed out. If a rebate on a credit card is income, I would think that if you buy something for $100, fill out a form online, and take a photo of the receipt and UPC and submit them, and 3 months later they send you $15 as a rebate, that would be income also. Want instant gratification? Go to the supermarket. Buy 5 cartons of soda for $15. The register shows $15 owed. Let them scan your loyalty card, and magically, $5 comes off the bill. That would also be income. The issue of the value of airline miles (loyalty points) being taxable has been around for decades. When would it be taxable? When you earn them? If so, when they expire, do I get a rebate? When I use them? If so, is the value the cost of a full-fare ticket that the miles replaced? A can of wriggling worms.

Don’t overthink it. Credit card rewards are non-taxable. The IRS treats rewards as a “discount,” since you are spending to receive a “discount.”

[www.irs.gov]

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 31 year old male and willing to travel!
I agree with you. I guess I wasn't clear that I was trying to show that if you went down that rabbit hole, the implications would be huge. I personally don't think that any of them are taxable.
@Tarantado wrote:

@myst4au wrote:

So, let's go down the rabbit hole that Cease pointed out. If a rebate on a credit card is income, I would think that if you buy something for $100, fill out a form online, and take a photo of the receipt and UPC and submit them, and 3 months later they send you $15 as a rebate, that would be income also. Want instant gratification? Go to the supermarket. Buy 5 cartons of soda for $15. The register shows $15 owed. Let them scan your loyalty card, and magically, $5 comes off the bill. That would also be income. The issue of the value of airline miles (loyalty points) being taxable has been around for decades. When would it be taxable? When you earn them? If so, when they expire, do I get a rebate? When I use them? If so, is the value the cost of a full-fare ticket that the miles replaced? A can of wriggling worms.

Don’t overthink it. Credit card rewards are non-taxable. The IRS treats rewards as a “discount,” since you are spending to receive a “discount.”

[www.irs.gov]

Shopping Southeast Pennsylvania, Delaware above the canal, and southwestern NJ since 2008
@myst4au wrote:

Want instant gratification? Go to the supermarket. Buy 5 cartons of soda for $15. The register shows $15 owed. Let them scan your loyalty card, and magically, $5 comes off the bill. That would also be income.
That is merely a discount on your purchase, the same as a coupon would be.

Edited 1 time(s). Last edit at 03/22/2021 03:12PM by MisterBill.
I posted it here because next quarter's rewards are places we shop.

"There's so much trouble in this world; surrounded by miracles" - Citizen Cope
No rabbit hole exists. There is a vast difference between the ordinary consumer (or mystery shopper! ) and these people who deliberately used the cards to generate cash income.
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