It's times like this when I love credit cards

hoffse · December 2014

I mentioned in a previous post that my employer is reimbursing me for school tuition to get my LLM. It's through a large state school, so it's not crazy expensive, but also not cheap!

Anyway it comes time to enroll and pay the first bill. Turns out, the school takes AmEx with no additional processing fee.

I get 2% back on my AmEx, deposited as cash into my Fidelity account.

2% back on tuition ought to be... oh... somewhere around $630, assuming tuition costs do not increase next year. Credit card points win!

formerlyGDaisy09 · December 2014

YAY! I love charging things I get reimbursed for

I think I earned a few hundred dollars in rewards last year on things that work paid for

noffgurl · December 2014

Awesome!

abrewer5 · December 2014

That's awesome!

strickland8052 · December 2014

That is so exciting! I paid my tuition with my cc for the points too. Of course, I didn't get reimbursed for it, so it was not near as exciting as yours. Congrats! That is an awesome win!

I can't wait to pay for our baby moon with the CC!

That should be a couple hundred bucks in points.

hoffse · December 2014

Yeah credit cards aren't for everybody, but if you use them responsibly they can be great for free stuff! Honestly, I'm surprised I was able to pay this with a card. My undergrad and law tuition couldn't be paid by card without a processing fee, H's undergrad was the same, and the college where my dad teaches is also the same. So when I saw I could put it on a card without an added processing fee, it was a great surprise!

I emailed my dad about it, and he's bemoaning the fact that he couldn't pay my undergrad with his AmEx (he has the same one)... I went to a $$$$$ private school for college. I had a scholarship, but still... it didn't cover room and boarding! My dad would have been rolling in credit card rewards if he had been able to use the AmEx for that!

@strickland, we're debating about hoarding the points for baby "start-up" expenses or else using it to make sure we get a babymoon! I think we'll be TTC in just over a year, so we sort of have our eye on that as well.

Xstatic3333 · December 2014

That's awesome! I love my work reimbursement too, but it's not nearly as good as that! We did just book a bunch of free flights though, so no complaints.

HoneyBee973 · December 2014

That's exciting!!!

maple2 · December 2014

I've honestly always wondered if at some point people will have to start paying taxes or something on credit card benefits earned in this way. My dad travels a ton for work and has received so much free personal travel (and other random products) as a result of the credit card points. I'm sure it would be tremendously difficult to track and measure for tax purposes, but it really can be a pretty substantial benefit for some people. I'm glad it worked in your favor, though.

hoffse · December 2014

maple2 said:

I've honestly always wondered if at some point people will have to start paying taxes or something on credit card benefits earned in this way. My dad travels a ton for work and has received so much free personal travel (and other random products) as a result of the credit card points. I'm sure it would be tremendously difficult to track and measure for tax purposes, but it really can be a pretty substantial benefit for some people. I'm glad it worked in your favor, though.

I've wondered this as well. On the one hand it may be income - I'm not aware of an exception for points/rewards/free stuff. On the other hand, it's arguably a gift, since it's subject to change at any time, and gifts are not taxable. For now, I'm sticking with the "it's a gift" argument

I should look it up though - I'm sure there's guidance out there somewhere about how it's treated.

noffgurl · December 2014

I wouldn't be surprised if the they figure out a way to tax it.

hoffse · December 2014

noffgurl said:

I wouldn't be surprised if the they figure out a way to tax it.

My gut says they probably do tax it already. They just don't want to deal with returns/forms from the credit card companies for every single customer, so customers are probably supposed to self-report rewards.

The IRS already deals with personal tax returns and corporate/entity tax returns and estate tax returns.... they also get forms from banks and employers reporting what was paid to customers and employees. Can you imagine if they also collected that info from credit card companies? They would be buried under paper for a pretty low pay-off. It's much more lucrative for them to sift through reports from banks stating that customer X sold $100,000 worth of stock last year and now owes the IRS taxes on that sale.

Just a guess.

cbee817 · December 2014

Gotta love credit cards- I paid for my grad school that way too. One class at a time (in the evening) and my employer reimbursed me.. it was fabulous!

dragonstarjk · December 2014

Woohoo! I love credit card points! I actually have several credit cards that I use interchangeably depending on their points program (never, ever carrying a balance or paying interest). I pay for most of my Christmas shopping with these and usually can get a couple of restaurant gift cards in the summer to use when we travel. I have Amazon Prime, so my coworkers always ask me to order stuff for them and then they pay me in cash. I order with my Amazon card and get the points! Yippee!!!!