I would like to open a Paypal prepaid debit, to take advantage of the adjunct 5% APY savings account. I'll just park money there and eat the monthly $5 fee.

Is this a bad idea? alternatively, any referral codes (via PM, please)?

Hmm... never heard that before, but the account certainly was less than 2-3 wks old when I signed her up for the card.

Loading BB/Serve at WM with kate or cashier using your PP biz MC - no 1% bonus.

Loading BB/Serve via their web site using your PP biz MC = 1% bonus.

(going back for a second) Searched through this thread a couple times, read almost the whole thing and havent really come across anyone running into issues doing MyCash>PP>Serve withdraw. Is this true? This seems like it would raise flags would it not? Wouldnt this be just as bad as MyCash>PP>regular bank withdraw? I was under the impression your best bet was MyCash > PP#1 > PP#2 > withdraw.

Guys, I have what I think is a newb question.

I collect thousands of dollars per month into my business paypal account, for which I have the PayPal Business Debit card (this pays 1% cash back on every non-PIN transaction). (I use PP as my credit card processor for clients.) Given that I am already a heavy PP user, is this possible:

1. Use some credit card to buy a $500 PayPal cash card for $504.95. (Can you buy these using a CC?)
2. Load PayPal cash card into PayPal account
3. Use PayPal Business Debit Card to load $500 onto Serve
4. Use Serve funds to pay off credit card
5. Get a 1% cash rebate for using the PayPal Debit Card (1% of $500 is $5.00).
6. Earn X miles and $0.05.

If you're using PP as a CC processor for your clients, why would you risk shut down? :confused:

Well, I actually have two PP business accounts -- one for clients, and the other... just because.

Also, it's not really that big a deal to get a credit card merchant account. I just haven't done it. It's probably cheaper, but I seem to get paid faster via PP.

Just be careful because having 200 transactions that total $20,000 or more will force PayPal to send you a 1099. The taxes that you will end up paying on those $20,000 will erode any profit you may have made from that MSing.

EDIT: You can actually get the business debit card for personal accounts. Just Google "PayPal business debit card", click on the first link, and apply.

Taxes aren't paid on gross income, silly. ;) The earnings (which is what is taxed) is gross minus expenses. What do you think the expenses will be? You *do* have to keep all receipts and keep your books correctly, but if the OP is already a business owner, he's doing that now. I hope. ;)

You are correct, but that sounds like an auditing nightmare to me.

$3.95 and $1.05, respectively.
(2100% revenue improvement! for more 5 seconds business consultation, PM me :D)

It's not any more nightmarish than anything else in an audit. As long as everything you're doing is aboveboard and you have the paperwork to prove it, you'll be OK.

Of course, and what I think you're saying, is that you should try to avoid behavior that might lead to your being audited. While I agree, I don't think this is particularly bad. After all, the 1099 income is explained truthfully. A business owner has to do this for everything, not just "Form 1099-MS".

And yes, audits can be very painful. A very good friend was audited, assessed tens of thousands in bogus back taxes, and was forced to sue the IRS. She won, but the legal expenses almost forced her into bankruptcy. It's nine years after that, and she's almost back on her feet.

I just remember how hard and annoying my auditing class in college was. It was the reason I never sat for the CPA and pursued a career in finance instead :D

It isn't a particularly terrible bookkeeping exercise. Really, it's just moving money that is already mine around and around for no purpose. :)

Thanks for input, everyone! Seems worth a shot!

Various financial crises make so much more sense now...