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You cannot combine miles to get an award.

You can use miles from one account to upgrade someone else, or get them a ticket, though.

So if you want a 20K upgrade, 2 directions, 2 passengers, with the mileage you described, you're fine. Pull 1 from one account, and 3 from the other.

I have a feeling the problems you encoutered were a result of semantics. If you tell a rep you want to combine miles to do something, the answer will to pay the fee and transfer the miles (if don't take the time to look at your scenario). Also, you're not allocating miles to an account (again, that sounds like a transfer). You're using his miles to upgrade your flight. Use that language, and you'll be fine.