George L
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yes you need your check account number |
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Bart M
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You'll pay the "stupid tax" |
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Ted
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Not by the government. That is a loan, not income. You have to pay that back with interest, you know? You also paid about 3% in fees to the CC company for the privilege. |
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Navy Sailor - GAI
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No but you will be paying a ton to your credit card company. The standard fee for balance transfers/cash advances is 1% to 5% of the amount you request. If $9500 was your entire balance on that credit card you will also get hit with an over the limit fee which is a minimum of $50 for most cards. NEVER EVER do balance transfers unless you read and understand all the fine print in doing such a transaction. Also, I recommend any book by Suze Orman, she can help anyone dig out of financial nightmares. |
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glennroid
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No, it's not income, it's a loan. |
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annazzz1966
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It's not called a balance transfer, it's called a cash advance. The interest rate you'll pay on a cash advance is higher than if you just make a regular purchase on your credit card. Then there is a fee you have to pay based upon the advanced amount. |
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Micki
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If you cannot figure this out, you honestly shouldn't be doing such transactions. Someone, somewhere is going to take advantage of you and we yahoo'ers aren't going to be there to answer your questions. |
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elb
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Your question is confusing -- not sure if this will help clarify. Usually a credit card balance is a debt. Most balance transfers are moves consumers to transfer a debt amount from one credit card to another credit card, usually to take advantage of a lower interest rate. For example, if you have a $9,500 balance on credit card A and transfer it to credit card B, you still are $9,500 in the hole.
Moving a debt from one credit card to another credit card does not generate any income, so it is not a taxable event. Also, it would be pretty unusual to have a $9,500 CREDIT on your credit card, like if you overpaid your bill by that amount. If that were the case, the credit card company would be likely to want to give you a credit balance refund, a different scenario from a balance transfer. |
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Zeltar
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Income is taxed. For example, Income from wages, stock dividends, Rental Income, and Interest. A loan is not income. Though it's a deposit, you are really obtaining money that you hope to make in the future with a promise to pay interest to have that money before you have earned it. The government doesn't charge taxes for this as they will get you upon you actually earning the money. But, the institutions that lend you the money will surely bill you for the use of their money until you finish paying it back. |
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scalloper
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No, you have to repay the loan |
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greeter7
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There will be no taxes on the transfer unless the bank charges you something. You should have spoken to the bank before you made the transfer. If you have that much money you should have the knowledge to handle such an amount... DuH! |
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Jeff T
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It's a loan, not income.
But the interest and fees could be considered "stupid tax" |
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piyo006
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No, this is not a taxable income. It is a loan to you and you should not be doing that. It's considered cash advance from your credit card and the interest rate charged is not the same as purchases and is alot higher then a loan offered by a bank. |
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sacmen4fun
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No, but you will probably pay a fee and a high rate of interest on that transfer! |
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thunderrz
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no. |
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Fred S
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You will be taxed on any interest the money makes for you. But given the low interest rates that bank are paying and the short amount of time the money is likely to stay in your account, I would not worry about it. |
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Vic J
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There are actually 2 transactions taking place here.
1. You borrowed money from a credit card, and since that is debt, is not taxable.
2. You deposited that money into a checking account. Any interest you earn will be taxable, no matter where the money came from. If you have a non-interest bearing checking account, then you won't earn any taxable interest.
If you put that money into a savings account and earn interest, you will be obligated to pay taxes on that interest earned. |
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Gone fishin'
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No. It is a loan not income. However you might consider the interest as a stupid tax. |
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wanosd
 |
Loans are not taxable. However, if you do not use that cash and the cash generates an interest payment to you from the bank, that interest may be taxable.
That's what I'm doing. I'm taking a 0% interest rate balance transfer from my credit card for over 25k, with a 3% fee and maximum fee of $75, and then putting that money into a checking account that gives me 5%+ back. I'll make money and then pay the credit card company back.
So for example, I take out a $25,000 loan. I pay the credit card company 3%, to a maximum of $75. So my real loan is $25,075. I put $25,000 into a checking account that offers me a return of 5.5%. That's $25,000 x 0.055 = $1,375 after a year. Of the $1,375, about 20% goes into taxes, so I'm left with $1,375 x 0.80 = $1,100. Of that $1,100, I have to pay the credit card $75. I'm now left with $1,100 - $75 = $1,025 of pure profit.
The important thing is make sure your credit card company has a limit on the balance transfer fee. Bank of America doesn't have a limit on their balance transfer fee, so 3% of $25,000 = $750 !!!
Go with Citi Bank or Wells Fargo, which caps the fee at usually around $75.
Generally though, most major banks will only give you like 0.1% interest rate, which is pathetic, so you may not have to worry about taxes.
http://www.highyieldcheckingdeals.com/ |
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John Harris
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No because its not income. The bank isa simply lending you money. |
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Anon Kirby
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A balance transfer is a loan, or cash advance, from your credit card or bank. You pay fees and interest to the credit card company or bank, but you do not pay taxes because this money is not income that you earned.
However, if this money (loan/cash advance) earns interest while sitting in your bank account, then the interest earned is subject to income tax. |
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yzemann
 |
there should not be a tax for a xfer....just processing fees |
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donfletcheryh
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Your year end tax may have income from your savings account, which is taxable, and you can apply the cost to borrow money against that income, so that you will likely have no net tax.
Businesses all the time borrow money to make money, and the interest they have to pay for the loan is a business expense for tax purposes.
Few businesses will use a credit card to get that loan, but if the interest and terms are just right it could make you a trivial profit. |
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iseaulater2
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no |
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STEVEN F
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NO. You are taxed on INCOME, not loans. Also note: this is NOT a balance transfer. It is a CASH ADVANCE. A balance transfer is when you use the card to pay the balance of another loan. |
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CHAR L
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YEP |
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POOPSY
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no tax will be owed but shop around and negotiate interest rates.you cna open a secured line of credit on a property if you own one.@4.75% or apply for a regular line of credit at the bank for about 5.75 to 6.25% good luck.best of all cut up any credit cards they are only trouble.if you cant pay cash you cant afford it. |
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visvardis
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uuuhhhh no |
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Maxine H
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I don't think you can get taxed for stuff like that. You might have to make an interest payment. |
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RWR
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NO! you are creating a loan to yourself from your credit card.
Think of it this way. Have you ever been taxed when you made a purchase with your ctedit card? A=No |
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R S
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Yes sir,
And you will pay dearly for this transaction.
Woo, lots of money they are going to hit you with for taxes.
I would call an attorney and pick his brain. Hopefully he won't
charge you for your question of help in this problem.
I am always afraid when i get free checks for me to use. I
wish they never got mailed to me for fear someone else my
intervene and try to blacken my name.
You should find that company that advertises how to protect
your ss# and identity. Not the insurance one either.
You might be able to stop these Sob's from credit card
checks and crap forcing people to get in debt. |
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