Tax treatment of credit card cash back bonuses

I use my credit card to pay business expenses. I submit recepts to my employer. They reimburse me for the expenses in full. At the end of the year I get cash back equal to a percentage of all purchases. To the best of my knowledge my employer does not require me to return a portion of this cash back bonus.

Do I have to treat a portion of my cash back bonus as income? [My understanding is that in general, these are treated as a delayed discount on the goods bought so aren't in general taxable, but may affect the cost basis of durable items. Since reimbursements are generally limited to no more than the amount actually paid...]

This feels like it could be a massive paperwork hassle for a relatively small amount of money --- tens of dollars --- especially since different purchase qualify for different bonuses in a poorly documented fashion.

If its taxable income, where shoudl I report it? Is it also subject to payroll taxes?

Reply to
bill-deja
Loading thread data ...

Rebates are generally not taxable because they are just a reduction of the cost price of an item. However, if you got remibursed $100 for the cost and then $1 cash back, you should have only got reimbursed $99. So you should either return the $1 to your employer (who will report it as income on their tax return), or put it into Line 21 Other Income.

Reply to
remove ps

Rebates are generally not taxable because they are just a reduction of the cost price of an item. However, if you got remibursed $100 for the cost and then $1 cash back, you should have only got reimbursed $99. So you should either return the $1 to your employer (who will report it as income on their tax return), or put it into Line 21 Other Income.

Reply to
remove ps

Rebates are generally not taxable because they are just a reduction of the cost price of an item. However, if you got remibursed $100 for the cost and then $1 cash back, you should have only got reimbursed $99. So you should either return the $1 to your employer (who will report it as income on their tax return), or put it into Line 21 Other Income.

Reply to
remove ps

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.