Some credit card rewards may be taxed, and taxpayers should know the hidden rules. While cashback from spending is usually safe, referral bonuses and no-spend welcome rewards can count as income.
Key takeaways
Quick scan — what you need to know:
- Some credit card rewards may be taxed, and taxpayers should know the hidden rules.
- While cashback from spending is usually safe, referral bonuses and no-spend welcome rewards can count as income.
- People may need to report them in tax returns.
- Experts warn to check forms and amounts carefully.
Background
What led here, in plain terms:
- Understanding these rules can help avoid mistakes before filing during the tax season.
- Some credit card rewards may be taxed, and taxpayers should know the hidden rules.
- While cashback from spending is usually safe, referral bonuses and no-spend welcome rewards can count as income.
- People may need to report them in tax returns.
Why it matters
Why readers and decision-makers should care:
- While cashback from spending is usually safe, referral bonuses and no-spend welcome rewards can count as income.
- People may need to report them in tax returns.
- Experts warn to check forms and amounts carefully.