Currently, control and disposition of frequent flyer miles that you earned during the course of business travel are in the hands of your employer. Some employers require their employees return earned mileage to the company. Other employers, admittedly very few, deem frequent flyer points to be part of their employees’ compensation. The vast majority of employers take no action and allow employees to retain frequent flyer miles, which they earned during business travel, for their personal use.
The IRS is on record that, until further notice, it will not include frequent flyer miles in anyone’s income. This includes situations in which miles are earned either for business travel or for personal expenditures. Several years ago, the IRS had attempted to tax frequent flyer miles as compensation. However, the IRS backed off after airlines, transportation trade associations and business groups complained that the their approach was unworkable. Although the IRS reserves the right to reassert the position that miles should be taxed, for all practical purposes, it will continue to exempt these miles from tax. The IRS must develop an administratively feasible way to tax these miles; otherwise, it is not a likely possibility for the foreseeable future.
For more information, please contact Henssler Financial at 770-429-9166 or experts@henssler.com.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
