Is a credit card cash advance considered income?

So, is a credit card cash advance actually income? I mean, you get the money, right? Feels like income, doesn’t it? But apparently not, at least not according to what I’ve been reading. It’s a bit of a head-scratcher, honestly.

They say it’s not income, it’s an advance on future sales. Think of it like… okay, let’s say you’re a freelancer like me, and you’re expecting a big payment next month. But bills are due now. You grab a cash advance; you’re essentially borrowing against that future paycheck, right? It’s not like someone just gave you a gift – you’ll be paying it back, with interest, ouch!

The confusing part? The initial amount you get isn’t taxed. But the money you make to pay it back? Totally taxable. Remember that time I used a cash advance to buy supplies for a big client project? Had to pay taxes on the money I earned from that project, even though some of it went straight back to the credit card company. Talk about a double whammy! It felt so unfair then. Honestly, the whole thing is a bit of a financial mind-bender.

So, yeah, while it feels like free money at first (and who doesn’t love that feeling?), it’s definitely not considered income in the eyes of the taxman. But don’t get too excited, because what you earn to pay it back definitely is. Just something to keep in mind – learned that the hard way!

#Cashadvance #Creditcard #Income