What I'm thinking is setup a merchant which will be linked to your bank account, purchase a "service" from your merchant account, google will deposit the funds right back into your bank account and then you pay off your credit card with those funds.
The only thing I'm not too well versed in is the tax ramifications. Google gives you two options for setting up your merchant. You can either: 1) Use a business you already have established by giving Google a Federal Tax ID #, or 2) Set up the merchant using your Social Security #.
Let's discuss and figure out the best way to make this happen!
Reading through some of their FAQ's they mention that some accounts have a monthly payout limit. Below is more information from their website on it:
A monthly payout limit is a restriction on the total amount of earnings you can receive at one time.
When you process transactions through Google Checkout, your payouts are sent to you according to the standard payout schedule. With a monthly payout limit, however, your earnings will be paid to you over a longer period. For example, say you have a monthly payout limit of $500. If your total sales in July equal $600, only $500 will be paid to you in July; the remaining $100 will be carried over to your August payouts.
Not all sellers have monthly payout limits. If you have a payout limit, the limit amount will appear on your Payout Summary page, Payout Summary Details page, and payment settings page. On these pages, you may also see a notification message asking if you'd like to remove your monthly payout limit. By clicking the link in the message, you can request that Google perform a simple review and remove your monthly payout limit so you can receive your payouts more quickly. (If you don't see these notification messages, you aren't currently eligible to have your monthly payout limit removed.)
Your Social Security number and Federal Tax ID/EIN are strictly for Google's use in helping you sign up for Google Checkout. Under normal business circumstances, this information won't be used for governmental tax purposes or other activities outside the scope of the Google Checkout program.
There are numerous other threads on this topic and I think the general consensus is that it is illegal.
It would certainly raise red flags from a tax perspective. Essentially, the IRS would want to know why thousands of dollars were earned (and subsequently spent) by a "business" -- legitimate or otherwise -- and whether those expenses were, indeed, legitimate business expenses.
The scheme is also a violation of Google's terms, in that it prohibits someone from using Checkout either to provide cash advances (which is what is being done here, in essence) or to use it without actually selling a product or merchandise.
The promotion is enough for me to sign up for my own business purposes. There's no way I'd use it in the method suggested, though, given the risks involved.