US Man Earns Huge Fortune of $300,000 Through Credit Card Reward System

When people use their credit or debit cards to make purchases, they receive incentives (Credit Card Rewards).

People might occasionally make a few thousand rupees with this, but a US physicist made up to Rs 2 crore 17 lakh utilizing his smart intellect.

To make money, he juggled credit cards, money orders, and gift cards. 

According to the Wall Street Journal, physicist Konstantin Anikeev has long been interested in making money using credit cards. He'd been doing it since 2009, and he'd gradually turned his hobby into a lucrative business, making millions of dollars. 

According to the report, Konstantin began purchasing a large number of gift cards with his credit card. He'd first buy a gift card and then redeem it. He'd then deposit the money into his bank account and pay his credit card bill. His profits would be the incentives he earned over the course of the period. 

Here's an example of how the entire process works. Let's say he gets $25 as a reward after purchasing a $500 gift card as per the rule of 5%. He uses $6 to encash the gift card leaving him with $19, which is the profit he earns throughout the transaction. 

Anikeev earned $300,000, according to the report. Meanwhile, as his income increased, someone informed the US Tax Department. Following an investigation, the department issued him notices for disproportionate assets. 

After that, the matter was heard in court. Anikeev, who appeared to court with gift cards in a tub, fought his case in an unusual manner. He stated that these were not his earnings, but rather credit card discounts and perks.

Following a hearing of both parties' arguments, the court determined that gift cards are property and that any rewards (Credit Card Rewards) gained from the transaction are not taxed. However, if the gift card is redeemed for cash, it will be taxed. 

Since Anikeev resorted to cash out the gift cards, the court ruled that he has to pay income tax. As a result, the income tax department is now working on an account to tax Anikeev. 

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