<prompt> Human: Im asking this on my girlfriends behalf. Her job recently changed their bonus program. Previously the employees used to receive extra money on their paycheck if they met certain criteria, between 100-300. Now the bonus system has changed, and when they qualify for a bonus, they receive points. The points can be redeemed for any number of things, including actual physical merchandise or gift cards to common retailers. However, from what I understand from her, the bonus is not being taxed -- it is presented as a 500 points bonus, and those 500 points can be redeemed for a 500 giftcard to Amazon, or whatever. Im concerned that the government will see this as compensation which I feel it is and go after her at the end of the year for unpaid taxes on the amount. But since you can redeem the points for items I thought there might be some gray area here where they are standing. Im suspicious because the amount has increased quite a bit too from 100-300 to 500 points, and that makes me think that the company has found some way to duck around the tax issue on their side. So should she be saving a portion of her points for tax purposes?  <response>: This seems like compensation. Credit card points are different as they are considered rebates and are based on purchase activity, and as such, are not subject to taxation. 