1. Forums
  2. Mystery Shopping Discussion

Bringing back the tax question regarding pay with a gift card

February 19, 2024 09:11PM
Now that many of you have begun to file taxes I am wondering what everyone has decided to do about the restaurant shop where we earn a nice sized gift card and get to keep the portion not spent on our meal.
How have you all decided to report the income? from the leftover portion of those gift cards?
Reply
Log In
x

Create an Account or Log In

Membership is free. Simply choose your username, type in your email address, and choose a password. You immediately get full access to the forum.

Already a member? Log In.

More About Payment
February 19, 2024 10:25PM
Shhh
Reply
February 20, 2024 05:41AM
I accept cash. If I cannot put it in a bank, I don't want it.

That said, the unspent value of those giftcards is certainly taxable income. One could minimize the amount of taxable income by putting the cards up for auction and reporting as income their value as determined in the marketplace or one could just give them to charity in the same way that one disposes of all tangible objects obtained and reimbursed by MSCs.
Reply
February 20, 2024 07:19AM
It's not income if you spend the entire $100 doing the shop :-P

Also, if it was truly income, wouldn't the MSC be required to report on it if it exceeded the $600 threshold? I didn't get a 1099 for it and went over the $600 if you count the GC as income.
Reply
February 20, 2024 09:04AM
It is a tricky subject to me. I would definitely think it should be reported as income however, as someone pointed out in the thread when these jobs first came out , the value of the leftover gift card seems to be reduced from the face value by the fact that it can only be used at the specific restaurant where to me prices are inflated. Perhaps the reportable value would be how much it can be sold for cash whether you sell it or not.
Rousseau if you don't want them you can always give them charitably to me. AS long as you give me less than $16,000 worth , or whatever the annual gift tax exclusion amount is in 2024, I would be glad to take them .
Reply
February 20, 2024 01:02PM
[www.irs.gov] Control F "gift card" to find info quickly
Reply
February 20, 2024 05:28PM
That was an informative link.

I want to add that if the total "revenue" for a shop was in the form of a gift card and you decide not to report the gift card as revenue, then you can not deduct any expenses incurred on this shop. The cost of the meal would presumably be offset by the gift card, but you will be unable to deduct mileage, parking, tolls, etc.
@olympia tennenbaum wrote:

[www.irs.gov] Control F "gift card" to find info quickly

Shopping South Jersey, Southeast Pennsylvania, and Delaware above the canal since 2008
Reply
February 20, 2024 06:03PM
Thank you for providing that. It is an eye opener. Luckily I don't mind eating at this restaurant when not on a shop.

@olympia tennenbaum wrote:

[www.irs.gov] Control F "gift card" to find info quickly
Reply
February 21, 2024 12:36AM
@sandyf wrote:

Thank you for providing that. It is an eye opener. Luckily I don't mind eating at this restaurant when not on a shop.

@olympia tennenbaum wrote:

[www.irs.gov] Control F "gift card" to find info quickly

I think you could claim the going rate for the gift cards. If you tried to sell it on a marketplace and could only get $90 rather than $100 you could argue the value. I have done that in the past for sports tickets but not for a gift card. Although, it might not be worth the effort for a small amount.

Edited 1 time(s). Last edit at 02/21/2024 12:38AM by olympia tennenbaum.
Reply
February 21, 2024 01:39AM
what's about Rakuten rebates? Shall we report them?

Shopping Eastern Pennsylvania since 2009


Edited 1 time(s). Last edit at 02/21/2024 01:48AM by gene.
Reply
February 21, 2024 01:44AM
IMHO, after-sale rebates are in the same category as mileage points received for plane flights as well as rewards for hotel stays. The IRS had a plan to collect taxes on them about 15 years ago and decided not to do so. I don't recall the details of why they decided (or maybe it was Congress that decided) to forgo taxes on them, but IMHO, after-sale rebates are in the same non-taxable category.
@gene wrote:

whats abnout Rakuten rebates? Shall we report them?

Shopping South Jersey, Southeast Pennsylvania, and Delaware above the canal since 2008
Reply
February 21, 2024 08:12AM
@ServiceAward wrote:

@gene wrote:

what's about Rakuten rebates? Shall we report them?

Well, if you want to give the IRS free money, by all means do that. But, no, you do not legally need to report that. You've already paid taxes on that money when you earned it. Rakuten and other similar rebate platforms are giving you a rebate on money you spent, not money you earned.

Now, gift cards or other items earned from receipt or gaming apps like Fetch, CoinOut, etc., are legal income and thus taxable.

I don't consider money earned from Ibotta and Fetch taxable income. I have to purchase a product in order to get the cash back so it's more like a reimbursement. Credit card rewards aren't taxable either since we had to spend money in order to get the cash back. Interest in my savings account is taxable since I didn't have to spend any money to get the income.
Reply
Sorry, only registered users may post in this forum.

Click here to login