I plan to adjust it to $0.005/point. A fair market value of $0.01 doesn't make any sense, especially if I haven't spent them. Until I spend them, the points are the property of Amex. If my account is terminated, I'd lose all my points which I would have paid income tax on. Would the IRS then let me report that as a loss? I doubt it.
I think $0.005 is reasonable since that's what I'd get if I immediately cashed out to Amex gift cards which is the closest cash equivalent.

I'll report back here if the IRS fights it, but I highly doubt it. If Amex values their own points at $0.005 for their own gift cards, that's as strong a case as it gets.