Re: Is Rakeback Taxable?
There is not a good argument for rakeback to be excluded from income. Your example of coupons is comparing apples to oranges.
Gambling income is a taxable activity, therefore a return of your expenses related to that income is taxable. Coupons and frequent flyer miles are not taxable because you are not able to deduct the cost of the flight or the goods purchased with the coupons. If these items are deductible for you, then you only get to deduct the actual cash paid, which makes the coupons effectively taxable.
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