But if the business spends $100 and the rebate is $2, but I personally pocket the rebate instead of giving the money back to the business, wouldn't that $2 become taxable personal income? (and perhaps also theft, depending on my relationship to the business?)
If you run a small business and have a SB card, spending just $100k can get you more than $1k in rewards a year. $1k is still probably not worth the IRS tracking down, but getting on the IRS being too busy to tackle your tax fraud is still tax fraud.
For the same kind of points (Chase Ultimate, for example), you are taxed if earned via:
* Referrals
* Opening an account (i.e. Chase checking account)
* Other non-spending activities