What happens to points when return merch
 

I buy a bed at costco and use visa, get the points, spend the points, return the bed...

I havent done this and had no intention of trying to get something for nothing, but just wondered how this works...

for instance i used visa to buy the bed (bought it online) and if i were to use the points now and empty my points balance, what happens when i return the bed and get a refund?

You will have a negative balance in your miles account. You will never go "positive" until you repay the negative balance. Some programs have insisted that you buy the miles to cover the negative balance.

At a very expensive rate no less, up to 25 cents per mile.

lets say you get the refund BEFORE you spend any of the miles, they just deduct that many miles them from your balance, right?

If this a Chase card, it would directly deduct the miles from your correspondent FF program or hotel program.

If this is a Citi AA card, the negative balance stays on the bank side and you will not earn any additional from new spending until you make up the deficit on your account.

If this is a Citi ThankYou Point card, the negative immediately goes to your TYN account and the points are deducted.

This specific example would result in a different answer. Costco does not accept VISA at their stores, but they do accept it on their website. If you were to order an item from the website and return it to the store they would (reportedly) not be able to issue a credit to a VISA account and would give you credit in another form.

At most merchants, however, credit goes to the original form of payment and the credit would offset the original purchase for point/mileage calculations.