cancel
Showing results for 
Search instead for 
Did you mean: 

Meeting 4K Spending on CSR - Question

Auto Loans for ANY Credit Situation. Immediate Response.
Advertiser disclosure
Super Contributor

Re: Meeting 4K Spending on CSR - Question

Actually I miswrote. I never use square myself but looking back at it what was happening was people were getting their own square accounts shutdoiwn really quickly not their chase card per se. Since the square account is owned by another business and not OP's business this is not really a risk. Still I agree it doesn't make any sense with the tax liability that would be incurred and either way its certainly MS, although unless OP keeps doing it I doubt Chase would look twice at it assuming regular purchases are mixed in..  

;
Starting Score: EQ: 714, TU 684
Current Score: EQ: 725 7/30/13, TU 684 6/2013, Exp 828 5/2018, Last App 8/5/17
Goal Score: 800 (Achieved!) In garden until Sepetember 2019
Message 41 of 56
Moderator

Re: Meeting 4K Spending on CSR - Question

As a reminder advocation of MS cannot be posted in any forum of myFico I dont see any direct advocation here so I am going to let this thread run with the previous admonition. OP what you propose is a dangerous move for reasons already stated by quite a few members and I would not recommend such a course of action there are many other ways of meeting spend requirements. Have a good evening all Smiley Happy

 

gdale6 - myFico Moderator

"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne

Message 42 of 56
Frequent Contributor

Re: Meeting 4K Spending on CSR - Question

I agree that using square might be risky especially tax issue.

You could still try it though. Better to tell Chase ahead of time about upcoming large charge.

 

Also, you may look up in other forums to see what other ways to spend smartly and easily to meet the spending bonus! Lots of information out there.  Smiley Wink

Message 43 of 56
Super Contributor

Re: Meeting 4K Spending on CSR - Question


@csryang wrote:

I agree that using square might be risky especially tax issue.

You could still try it though. Better to tell Chase ahead of time about upcoming large charge.

 

Also, you may look up in other forums to see what other ways to spend smartly and easily to meet the spending bonus! Lots of information out there.  Smiley Wink


No, wait, did you read what the structure of OP's transaction is going to be?

 

Buy a "reserve fee for a catered event" from the company, for $4,000.

Company now has $4,000 cash less 1.3% Square fee.

Company reimburses OP through payroll / advances, however that is done. OP gets $4k back to pay off the card balance.

 

At 12/31/2017 OP gets a 1099 from the company, with regular earnings on the 1099, PLUS $4,000 additional "income" from the "reimbursed cancelled catered event fee".

 

OP files a tax return April 15, 2018 and is paying approximately $1,000 more in Federal Income Taxes in cash out of pocket.

 

I don't even see how this proposed transaction is a thing anymore. It's stupid.

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
Message 44 of 56
Frequent Contributor

Re: Meeting 4K Spending on CSR - Question


@NRB525 wrote:

@csryang wrote:

I agree that using square might be risky especially tax issue.

You could still try it though. Better to tell Chase ahead of time about upcoming large charge.

 

Also, you may look up in other forums to see what other ways to spend smartly and easily to meet the spending bonus! Lots of information out there.  Smiley Wink


No, wait, did you read what the structure of OP's transaction is going to be?

 

Buy a "reserve fee for a catered event" from the company, for $4,000.

Company now has $4,000 cash less 1.3% Square fee.

Company reimburses OP through payroll / advances, however that is done. OP gets $4k back to pay off the card balance.

 

At 12/31/2017 OP gets a 1099 from the company, with regular earnings on the 1099, PLUS $4,000 additional "income" from the "reimbursed cancelled catered event fee".

 

OP files a tax return April 15, 2018 and is paying approximately $1,000 more in Federal Income Taxes in cash out of pocket.

 

I don't even see how this proposed transaction is a thing anymore. It's stupid.


I dont disagree that it's risky and stupid thing to do, but if OP wants to try that it's really up to him/her eventually.

 

I doubt Chase cares where 4k is coming from except from the fraud perspective. Personal tax issue is definitely challenging but not sure if OP's thinking of using 4k to purchase "an item" from the company and then have the item returned to be sent a check to him/her to avoid the above tax issue. Either way, it's still sort of fraud related issue and risky. There are many ways to game the system and it's just how risky you want to take. Like I said again, there are many other ways to fullfill this spending amount to avoid this and many other potential issues. I definitely agree that OP's method is not something I would recommend people do.

Message 45 of 56
Senior Contributor

Re: Meeting 4K Spending on CSR - Question


@CreditCuriousity wrote:

@elim wrote:

If you owe any tax bill... that's a churn or two going through payusatax.com etc.


Not bad 1.98% CC as always i will owe taxes this year Smiley Sad.  Dang gov't loves blowing my money 


  5k last month and 6k in March (personal taxes) which I will probably churn the FOTM.. Then of course I have to file in April and pay some more, lol.  weeeeeeeeeeeeee


Message 46 of 56
Super Contributor

Re: Meeting 4K Spending on CSR - Question


@csryang wrote:

@NRB525 wrote:

@csryang wrote:

I agree that using square might be risky especially tax issue.

You could still try it though. Better to tell Chase ahead of time about upcoming large charge.

 

Also, you may look up in other forums to see what other ways to spend smartly and easily to meet the spending bonus! Lots of information out there.  Smiley Wink


No, wait, did you read what the structure of OP's transaction is going to be?

 

Buy a "reserve fee for a catered event" from the company, for $4,000.

Company now has $4,000 cash less 1.3% Square fee.

Company reimburses OP through payroll / advances, however that is done. OP gets $4k back to pay off the card balance.

 

At 12/31/2017 OP gets a 1099 from the company, with regular earnings on the 1099, PLUS $4,000 additional "income" from the "reimbursed cancelled catered event fee".

 

OP files a tax return April 15, 2018 and is paying approximately $1,000 more in Federal Income Taxes in cash out of pocket.

 

I don't even see how this proposed transaction is a thing anymore. It's stupid.


I dont disagree that it's risky and stupid thing to do, but if OP wants to try that it's really up to him/her eventually.

 

I doubt Chase cares where 4k is coming from except from the fraud perspective. Personal tax issue is definitely challenging but not sure if OP's thinking of using 4k to purchase "an item" from the company and then have the item returned to be sent a check to him/her to avoid the above tax issue. Either way, it's still sort of fraud related issue and risky. There are many ways to game the system and it's just how risky you want to take. Like I said again, there are many other ways to fullfill this spending amount to avoid this and many other potential issues. I definitely agree that OP's method is not something I would recommend people do.


OP made it clear that the company is not giving back $4k free and clear. The company is going to have $4k of it's own income, and to avoid the company paying income tax on that the company intends to pay the OP that money back, in a form and with a transaction that ensures the company can deduct that cost as a direct expense of the company, same as a subcontractor.

 

Trying to do a "return" woud have to go through Square again, negating the original transaction. There is nothing to return here. It's "services" being purchased.


The result of all this is that the OP gets a higher income reported on the 1099 which has to be included on the OP 1040 which leads to an increase in taxable income which, in round numbers, leads to $1,000 of additional cash expense the OP has to pay to the IRS for Federal Income Taxes.

 

There is no other option in this scenario of paying the company through square: OP pays additional taxes, a lot of additional taxes. To propose that any one "could still try it" just for fun and data points, that the tax issue is "challenging", no, sorry that is outright bad advice to be giving.

 

Please read the thread, and the OP comments before speculating on what the OP intends to do. It has been clearly stated.

 

Your last comment is heartening. Using the card for regular spend to get to $4k of actual spend, even using a payment service to pay a mortgage or rent costs, is the way to go. I think you agree with that. I am trying to erase any hint of suggestion that the OP should try to use the company Square account to make the card spend requirement.

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
Message 47 of 56
Valued Contributor

Re: Meeting 4K Spending on CSR - Question


@longtimelurker wrote:

@red259 wrote:

Yea don't do this. Good way to get your chase accounts shut down. Before apping for a card you should pretty much know how you are going to meet the min spend. If you have to resort to these type of tactics then this may not be the right game for you. 


I think we also need to be realistic with the warnings.   A single episode of $4K spend, which is probably going to look perfectly fine, isn't going to get Chase to shut down your cards.   For that , you need to be doing some obvious MS (where spending doesn't fit with declared income), illegal transfer or selling of URs, bad things with Chase banking etc.

 

And while in general it is best to meet minimum spend organically, there are also times like this where you might have considered the CSR for later on, then hear that you only have a few days to apply before the bonus is halfed.   You might already be doing obvious things to meet spend on another card, or just don't have these expenses available to meet the $4K.    Then, to me, taking risks with other methods might be a reasonable choice.


Not really. There's a reason bonuses require spend, and part of that reason is to make one choose that card over another card for the bonus spend.

 

There's a million ways for Chase to find out. Did OP declare an employer while apping? Who here thinks Chase might get suspecious to see a charge exactly or roughly meeting the bonus spend from that employer? Chase can request tax returns or paystubs or other employment documents in the future under any circumstances and find out that way. I think that it would be a mistake to believe that Chase isn't watching this stuff.

 

There is actually an easy way to figure out whether any one way to do the bonus spend is kosher. Call Chase and ask. If you suspect, as I do, that Chase might not be cool with this way of meeting the bonus spend when one asks, then it's not a legitimate spend to meet the bonus.

 

Best case: OP gets hit with extra taxes. As a 1099 employee, OP is also responsible for both the employer and employee side of payroll taxes on that extra money.

 

Worst case: Chase finds out, and the OP is out both the tax and the UR points.

Message 48 of 56
Mega Contributor

Re: Meeting 4K Spending on CSR - Question


@yfan wrote:

@longtimelurker wrote:

@red259 wrote:

Yea don't do this. Good way to get your chase accounts shut down. Before apping for a card you should pretty much know how you are going to meet the min spend. If you have to resort to these type of tactics then this may not be the right game for you. 


I think we also need to be realistic with the warnings.   A single episode of $4K spend, which is probably going to look perfectly fine, isn't going to get Chase to shut down your cards.   For that , you need to be doing some obvious MS (where spending doesn't fit with declared income), illegal transfer or selling of URs, bad things with Chase banking etc.

 

And while in general it is best to meet minimum spend organically, there are also times like this where you might have considered the CSR for later on, then hear that you only have a few days to apply before the bonus is halfed.   You might already be doing obvious things to meet spend on another card, or just don't have these expenses available to meet the $4K.    Then, to me, taking risks with other methods might be a reasonable choice.


Not really. There's a reason bonuses require spend, and part of that reason is to make one choose that card over another card for the bonus spend.

 

There's a million ways for Chase to find out. Did OP declare an employer while apping? Who here thinks Chase might get suspecious to see a charge exactly or roughly meeting the bonus spend from that employer? Chase can request tax returns or paystubs or other employment documents in the future under any circumstances and find out that way. I think that it would be a mistake to believe that Chase isn't watching this stuff.

 

There is actually an easy way to figure out whether any one way to do the bonus spend is kosher. Call Chase and ask. If you suspect, as I do, that Chase might not be cool with this way of meeting the bonus spend when one asks, then it's not a legitimate spend to meet the bonus.

 

Best case: OP gets hit with extra taxes. As a 1099 employee, OP is also responsible for both the employer and employee side of payroll taxes on that extra money.

 

Worst case: Chase finds out, and the OP is out both the tax and the UR points.


I don't think anyone thinks that Chase would say "Yes, that's fine"  hence my comment about "taking risks"   Many of the points were discussed earlier on, don't make exact $4K charges, do they know your employer etc.   I think the chance of detection would be extremely small, even if Chase bothered to look, tax returns wouldn't show the info at all, and pay stubs would still be obscure.

 

That said, the tax aspect completley kills it.

 

As for calling, getting reliable info from a CSR is problematic at best.  Ask your issuer if it's OK to go on a app spree etc, and they might well say no.  It doesn't mean you shouldn't, your interests and the lender's may not be identical.   Same here, you want the bonus, Chase wants you to be a loyal user of (just) their card.....

Message 49 of 56
Valued Contributor

Re: Meeting 4K Spending on CSR - Question

Lol! This whole thing smells.

 

Also, everyone is forgetting that he has a charge from the same vendor that gave him income so he could technically net or expense that part because he technically didn't earn that income / refund of services.  It went in and out......?????!!!!!!! 

 

Gross sales is different than net income!

Personal Cards: Amex Gold, & Plat | Amex Delta Res | Amex Hilton | CSR | Citi AA Exec Business Cards: Ink+ | Amex BGR | Amex Plat
Message 50 of 56
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.