- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Get your taxes done using TurboTax
is this a new arrangement or has it been working for you for a while? Many credit card promotions differentiate between cash transactions and credit transactions, and transactions that count as cash advances don’t accrue special benefits. Also, I’m sure that if your credit card company figures out what you’re doing, they can probably close your card for violating their terms of service.
Be that as it may, if you choose to conduct your personal business in such a convoluted fashion, you are going to have to be responsible for any tax consequences. Transfers of funds between spouses are not taxable, but if you perform the transfers in a way that makes them appear taxable, you may have compliance issues with the IRS. Depending on the dollar amount of the transactions, you could also run afoul of something called “structuring.“ Structuring is when you structure a financial transaction in a misleading or illegal way to avoid reporting requirements even though the underlying transaction may be perfectly legal.
And in any case, we can’t tell you what the new IRS procedure to report nontaxable 1099-K forms will be until we find out if they are actually going to create such a procedure.