### Discover What The Geeks Know That You May Not
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Rewards Tax Status
In February, 2016 Tahsir Ahsan was at Walmart in Texas where he was making a large purchase in order to increase the amount of credit card rewards he would have available for future travel. In a series of events that unfolded quickly, Tahsir quickly went from having been given approval by the assistant store manager to make the purchase to having a by-standing cashier call the Walmart Asset Protection agent and two police officers who detained Tahsir and called an IRS agent over red flags about perceived fraudulent activity.
After a lengthy, 40-minute interview in which the IRS agent wanted to know things like what Tahsir did for a living, how Tahsir made money, and why Tahsir was in Texas; Tahsir was released. As he parted ways from the scene, Tahsir reflected "that by the end of it all, the IRS agent and police officer were sort of laughing at everything that was going on."
Tahsir was able to make use of the unique situation to ask the IRS agent some questions about credit card rewards taxation. While the IRS agent expected straight answers from Tahsir, she was cryptic in her responses and even after the encounter the best Tahsir could elaborate on the IRS agent's answers was "this IRS document which states, 'a rebate received by a buyer from the party to whom the buyer directly or indirectly paid the purchase price for an item is an adjustment in purchase price, not an accession to wealth, and is not includible in the buyer’s gross income.' The same IRS document came to the conclusion that, 'the portion of the credit card purchases that Taxpayers can either receive back in cash or request Company to pay to a charity does not constitute gross income to Taxpayers under § 61.'" - Adapted from Travel Codex