AMEX sending out 1099s for referral bonuses
Feb 9, 2019, 4:29 pm
#31
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Join Date: Jul 2008
Location: IAH
Programs: DL DM, Hyatt Ist-iest, Stariott Platinum, Hilton Diamond
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I could only wish people would get tired of AMEX's rewards shenanigans and just drop them.
It's already bad enough that:
1) Rewards are delayed an additional statement.
2) Citi and Chase now have JetBlue as a 1:1 transfer partner while AMEX sits at 250:200.
3) AMEX makes you pay the federal excise tax when transferring miles (nobody else does this).
4) AMEX has been hit or miss on dining bonus categories.
5) AMEX's bonus exceptions when applying for a card "because you've had too many opened AMEX cards recently," and sometimes denying bonuses when the box doesn't pop up for whatever reason.
6) And now taxing referral bonuses.
It's already bad enough that:
1) Rewards are delayed an additional statement.
2) Citi and Chase now have JetBlue as a 1:1 transfer partner while AMEX sits at 250:200.
3) AMEX makes you pay the federal excise tax when transferring miles (nobody else does this).
4) AMEX has been hit or miss on dining bonus categories.
5) AMEX's bonus exceptions when applying for a card "because you've had too many opened AMEX cards recently," and sometimes denying bonuses when the box doesn't pop up for whatever reason.
6) And now taxing referral bonuses.
2) Ok, I've never flown Jetblue, but good to know I guess.
3) Only for US airlines, and if you're burning MR points on Delta, Jetblue, or Hawaiian... As one of my friends on reddit has said, this fee is Amex's way of telling you you should be transferring MR elsewhere!
4) Fair complaint. Not one that's really impacted me, but a fair complaint.
5) Amex has made it pretty clear they're tired with churners/unprofitable or likely to be unprofitable customers. Can't say I blame them. Would you engage in a business relationship that would more than likely wind up being a loss to you?
Feb 9, 2019, 8:36 pm
#32
Join Date: May 2015
Location: Jacksonville, AR
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Posts: 245
Apr 10, 2019, 8:22 pm
#33
Join Date: Feb 2010
Location: London / Los Angeles
Programs: Hilton Diamond, IHG Diamond Ambassador, Marriott Platinum, Hyatt Globalist, BA Silver
Posts: 1,631
Out of interest, how many people are accepting the valuation Amex has placed on these referrals and are paying tax on them and how many are changing the valuation to 0 and not paying tax? Based on the legal advice in the link posted a few posts up, it seems like a pretty easy case can be made for changing the valuation to 0 and thus having no tax liability.
Apr 11, 2019, 10:47 pm
#34
A FlyerTalk Posting Legend
Join Date: Feb 2001
Location: Berkeley, CA USA
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Posts: 57,078
Out of interest, how many people are accepting the valuation Amex has placed on these referrals and are paying tax on them and how many are changing the valuation to 0 and not paying tax? Based on the legal advice in the link posted a few posts up, it seems like a pretty easy case can be made for changing the valuation to 0 and thus having no tax liability.
Apr 11, 2019, 11:20 pm
#35
Join Date: Feb 2010
Location: London / Los Angeles
Programs: Hilton Diamond, IHG Diamond Ambassador, Marriott Platinum, Hyatt Globalist, BA Silver
Posts: 1,631
A commenter at OMAAT asked how the member has income when Amex’s own T&Cs says the points belong to Amex. Fair question, and I think it goes back to my earlier point about valuing the points. This just seems to further suggest that points have a lesser value when issued. They don’t belong to you, and you can’t sell or barter them. Taken together, I think this makes the strongest argument for using a lower (or even zero) valuation.
Apr 17, 2019, 4:52 pm
#36
Join Date: Feb 2010
Location: London / Los Angeles
Programs: Hilton Diamond, IHG Diamond Ambassador, Marriott Platinum, Hyatt Globalist, BA Silver
Posts: 1,631
It wasn't so much as advice, as a description of a position some people are taking. Amex have it in their terms that all membership rewards points in your account technically belong to Amex, so the line some people are taking is that since they legally do not own the points awarded through a referral, they do not need to pay tax on them.
Source: https://www.travelcodex.com/amex-ref...ractical-tips/
Source: https://www.travelcodex.com/amex-ref...ractical-tips/
Feb 5, 2020, 7:18 am
#37
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