A to Z Challenge: E-Gift Card

[livingdeb]

I like to do my taxes by hand. Then, to double-check myself and submit the forms, I do them for real using Robin's Turbo-Tax when he's done.

This time there were no surprises until the end when I got the opportunity to receive some of my refund as an e-gift card to Amazon for an amount that was 10% more than the amount I designated. For example, if I chose to receive $200 of my refund as a gift card, I would get a $220 gift card instead.

I googled this and found the Finance Gourmet's Amazon and TurboTax Refund Special post, where I learned a few interesting things.

1) This option is only available if you bought Turbotax from Intuit directly or from Amazon. We bought ours from our local office supply place, but the Basic no longer did all the things it used to do, so Intuit ended up sending us a more deluxe version.

2) The extra money comes from Intuit, not Amazon.

Since I do actually buy things from Amazon, this was interesting. It changes the game a bit. Normally you should make it so that your refund is minimal so that your money is working for you. But can you get your money to work for you better than an instant guaranteed 10% increase? I can't.

The next question is how much? As the author points out, if you don't normally buy much from Amazon, it doesn't make sense to get much of your refund as an Amazon gift card. Of course the gift cards never expire, and Amazon is unlikely to go out of business any time soon, but the longer before you spend the money, the less exciting the instant 10% is.

Will they do this again next year? They caught some flack for making certain kinds of tax situations much more expensive than in the past though they made some situations cheaper. This bonus may have been created to encourage customers to happily pay the extra price if they have complex taxes.

Finally, if they do this again next year, will I be able to tell? It's currently possible to see this feature on Intuit's website (last row)--turns out it's only 5% for the Basic and 10% for the others. And Amazon has "+ Refund Bonus Offer" in the title.

Comments

[texpenguin.livejournal.com]

About 5 years ago, I came up with an idea of a way the government could get voluntary contributions to help it dig itself out of debt. They could work out deals with major online retailers like Amazon and Wal-Mart to get gift cards at a discount, say 15 or 20% off, for buying them in bulk, then allow consumers to opt for their refunds in gift cards worth 5 or 10% more than they were due. It would encourage citizens to loan more of their money to the government each year, which the government could use for short term projects, the retailers are happy because they get huge bulk order of gift cards, consumers shop with them over other similar retailers, and people rarely spend *just* their gift card amount. Everyone wins. This situation isn't quite that, but I still like it! I probably wouldn't use it myself, because I want my money to be more flexible (Amazon doesn't quite have everything I need, yet), but then again, none of my current investments are getting a 10% return!

[livingdeb.livejournal.com]

Very similar!

But how does the government pick which companies to use? Bribes, I fear. (aka lobbyists) Oh, wait, no, I meant market research. Yeah.

Yep, that was one of my questions--how much money can I afford to have be less flexible (turned into Amazon scrip)? For most places the answer is easy (zero). But I can actually use Amazon scrip. And HEB scrip. And surely a couple of other places. :-)

[texpenguin.livejournal.com]

I figured it would be whichever companies were willing to give a good rate for the gift cards. I wouldn't think bribes or whatever would be an issue, as consumers could always just opt for the normal cash option. Think of the CoinStar machines--those offer your cash equivalent in gift cards for a variety of places, likely places that paid CoinStar for the opportunity. So, that would be more money for the government to pay off debts!