Credit Card Rewards for CY20

[Chuckanut]

Both Lowes and Target cards get you 5% off purchases. Last year we spent roughly $6000 at Target, so thats $300 right there. And I did about $8000 worth of reno (all my labor) on the rental house (7 windows, storm door, ew flooring 1/2 the house, new kitchen cabinets, etc), so that was another $400 there. Seems yearly Capital One offers a bonus, which netted me about $650 last year. For most of our charges we are using a Marriott Chase Visa. When we were traveling we typically got $2000 in rooms for “free”. On vacations we like to stay in junior suites if they have them, especially in Europe. 2020 was a bust, of course, so we just keep on piling up points.

Obviously, I am not spending enough money.

 

[trixs]

I signed up for Chase Sapphire Reserve for the 80k bonus (was temporary bonus, usually 60k). Just had to spend $4k in 3 months. Then I referred my wife and got another 15k. At end of month 2 I used them to "pay myself back" @1.25%, so I got $1250 in 2-3 months.

Just referred DD for another 15k. DW got the 80k too.

In the end, we're looking at $2500 - $95 x 2 fee...

Last year we did the same for $500x2 sign up bonuses and canceled before the end of year fee. 1st year was waived. Don't recall the card name.

Did the same thing last year with the Sapphire Reserve for my wife and I. This year I just got the Amex Platinum. In our case we are a military family and the card companies do not charge us any type of fees. It essentially free money.

 

[Lagniappe]

In 2020 I had $5950 in what I classify as reverse bank charges. $3300 from bank sign on bonuses, and $2650 in credit card cash back. The big ones were Chase brokerage ($1000), Citi checking ($400) and CIT ($300).

Although it was a big spending year for me, the majority of it was to contractors who did not accept credit cards, so my credit card cash back was lower than normal. I mostly use the BoA Preferred Rewards card for 2.65% cash back on all purchases, but also use specialty cards for other purchases (Costco Visa for gas (4%), Amex for groceries, Chase Amazon card (5%), BoA cash rewards for 5.25% back on pharmacy). Since I've started using Google Pay I don't even have to carry a bunch of cards around with me.

I know many of you think this is not worth your time, but I probably spent 2 hours in total moving money around while stuck at home to get the sign on bonuses, and no time at all using my credit cards as I normally would.

 

[sengsational]

I know many of you think this is not worth your time, but I probably spent 2 hours in total moving money around while stuck at home to get the sign on bonuses, and no time at all using my credit cards as I normally would.

It just occurred to me that you're making thousands of dollars per hour...not a bad wage! And being offset against spending, it's not taxed...even better.

 

[Markola]

Bumping this thread to share a recent court decision about this former grad student who spent $6.4 million on his AMEX to buy dollar coins, to buy prepaid credit cards, to buy money orders, to pay off his Amex, netting $19 and points on every $500 he spent. His manufactured spending resulted in some $300,000 in benefits, which the IRS didn’t like so much.

https://www.thestreet.com/mishtalk/...racking-up-6-4-million-in-credit-card-charges

 

[FLSUnFIRE]

Interesting, IIRC, one of my cards mentioned in their fine print that I may get a 1099-MISC if I crossed a threshold ($500?) but that was specific to referral bonuses but I've only ever got one bonus as a friend was mentioning getting a card and I said if you choose to will you use my link? I'd never market to my friends.


I only manufacture spending by buying gift cards I eventually spend when there is a special rebate - primarily with the Chase Freedom and/or to hit the charge threshold for sign-up bonuses on new cards.

 

[ExFlyBoy5]

Interesting, IIRC, one of my cards mentioned in their fine print that I may get a 1099-MISC if I crossed a threshold ($500?) but that was specific to referral bonuses but I've only ever got one bonus as a friend was mentioning getting a card and I said if you choose to will you use my link? I'd never market to my friends.


I only manufacture spending by buying gift cards I eventually spend when there is a special rebate - primarily with the Chase Freedom and/or to hit the charge threshold for sign-up bonuses on new cards.

I've always been surprised that Congress haven't taxed these "gains"...that could be a LOT of money in the coffers.

 

[Koolau]

I've always been surprised that Congress haven't taxed these "gains"...that could be a LOT of money in the coffers.

Heh, heh, I wouldn't usually take the side of the gummint on such things, but at least what I read in the web post seemed pretty much spot on. If I read the ruling correctly, the "boys" won't tax your discounts on stuff or services. BUT if you make money at a "gig" (like punking the credit card companies) you will have to pay taxes on the proceeds just like any other business - hope the guy kept business records. Maybe he can deduct them from what he owes the "boys."

At least the "boys" accomplished a couple of their usual tasks. They made certain that "even when you win, you lose" (the guy had to go to court and pay his lawyers - heck he may end up in the hole.) They effectively set the standard for future "actions" and thus scared off most of the little guys who don't want to tangle with them. Win/win for them - even though, technically, they at least partially lost - you know, the part where they wanted their share of EVERYONE's discount. Can you imagine the relevant verbiage on every discount sign going forward? "Today only, 2 for one sale on Scope mouth wash - small print, you might owe the gummint taxes on the $5 you saved." At least we should never see that now since one guy got a "ruling." Heh, heh, but there's no limit to the number of times the "boys" can try, try again.

As I first read Markola's entry, I thought maybe the CC companies were the ones doing the complaining. I should have known it was the "boys" instead. One thing for sure, if you do ANYTHING very much, the "boys" will notice it. Makes me feel a lot safer, though YMMV.

 

[Markola]

^^^^ Yeah, someone will notice if you spend over $6 million on an Amex [emoji857]. I’ve also read that money orders are monitored, because it is or was a prime way for drug dealers to launder their ill-gotten cash. That’s good government in my book.