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Old Feb 26, 21, 3:08 pm
  #12  
ericdabbs
 
Join Date: Dec 2013
Posts: 3,335
The case got overturned and they ruled that that receiving points on the credit card is not a taxable event.

From the lawyer in the case
On February 23, 2021, the U.S. Tax Court rule in favor of our client that acquisition of credit card reward points, no matter how many the receive, is not a taxable event. In Anikeev v. Commissioner, the IRS tried to tax credit card reward points that the taxpayer received claiming they were “cash equivalents” because the taxpayer purchased gift cards with his credit card, which generated rewards points, and then used the gift cards to purchase money orders, which the taxpayer then deposited in his bank account. The Tax Court ruled the transaction was not a taxable event: “Reward [points] petitioners received were not notes, but they were commitments by [the credit card issuer] to allow petitioners credits against their card balances. Respondent’s analysis leaps to the cash equivalence position without an analysis of the origin of the[r]eward [points].” This was a case of first impression and an important development in the cash equivalent doctrine.

This is obviously a big win for Green & Sklarz LLC and Jeffrey Sklarz, as well as our client.

If you wish to contact Jeff Sklarz about the case or any other tax issue he cab eb contacted at [email protected]
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