Originally Posted by
rightseat
I am a second year FO that made about $140k last year. I rarely call in so I have a ton of swag points but I also do not want to be giving away buddy passes if it is going to be costing me a bunch of money. I just really have no idea how it alll works.
I'm pretty sure when it comes to buddy passes, you pay inputed income on only the SWAG points, not the buddy passes. I've never subjected a 'friend' of mine to a "buddy pass", especially with the new restrictions.
Anyways, back to SWAG, in my mind the best thing to do with them is to convert them to gift cards. A $100 gift card costs 6667 points, valuing the points at 66.7cents per point. Last year I was charged a rate of 1.48 cents per SWAG point. So the cost to me in tax, per $100 gift card is as follows.
6667 * .0148 * marginal tax rate (24%) = $23.68
Or basically the value of the card times my marginal tax rate.
The only way to get out of paying inputed tax is to opt out of the SWAG program, but you're better off just taking the gift cards and paying the tax. It's worth about $54 per month assuming you don't call in sick.