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Old Sep 7, 16, 6:09 pm
Join Date: Mar 2004
Location: San Francisco, CA
Programs: DL PM/MM, Hilton, Marriot, and Melia Silver, SPG+, Hertz PC
Posts: 7,856
Originally Posted by Spent_All_My_Miles View Post
Re fraud, it hasn't been stated why the policy exists. It may be to have employees be rested after the flight, productive during the flight, or both.
Even in that case it is not up to the company to define how an employee should best rest. As productivity is concerned, that could be an easier case, but if the employee is productive while sitting in Y the company cannot force him to sit in J.


For those who wonder if there are any cases, there are few involving frequent-flier miles, but Charley v. Commissioner from 1996 is somewhat on point. Charley was entitled to fly in first class to travel to clients. He would buy a first class ticket, submit the receipt for it, then exchange it for a coach ticket, upgrade it to first using his miles, and pocket the cash difference.

The difference, the Tax Court and Ninth Circuit held, is taxable income.
absolutely! The difference between flight cost and reimbursement received, if positive, is compensation and as such taxable. But that does not involve the employer, unless part of a scheme to understate compensation.
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