When Returning an Item for Store Credit, Do You Still Get to Keep the Points?
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When you’re returning an item purchased on your credit card, it usually means you’ll be returning the points and miles from that transaction too. But is that always the case? That’s what TPG reader PJ wrote in to ask:
If you purchase an item on a credit card that offers points and then return the item, BUT accept that return as a gift card from the vendor, does your purchase stay on the “books” with the credit card company and thus do you get to keep the points?TPG Reader PJ
To get straight to the point, yes, you should be able to return items to a store and if you accept store credit instead of a refund back to your credit card, those points and miles should stay in your account.
Why does this work? Even though you’re getting a “refund,” the credit card company doesn’t actually see this happening since you’re receiving the refund in a different form, not as a credit back on your card account. So for example, if you bought a $50 item from Target with your Chase Freedom Unlimited, you’d receive 1.5% cash back or 75 points (if you have a linked Ultimate Rewards-earning card) from the purchase. And if you returned the item and accepted Target credit you’d still keep those 75 points.
So, PJ, if you made a purchase and ultimately decided to return the item, requesting the refund as a store gift card should result in you keeping those points. This is good news if you’re on the verge of hitting a minimum spending requirement for a credit card sign-up bonus and the amount of the refunded purchase will mean the difference between you hitting or missing the required spending threshold. That said, it’s probably smart to spend a bit above the spending requirement to ensure you qualify the bonus. You don’t want to miss out by just a few dollars, after all.
We also wouldn’t recommend using this situation as a strategy for earning points, whether or not you’re working toward a minimum spending requirement. For one, you’ll still be banking cash with a particular retailer when you request the refund as a store gift card, so you wouldn’t want to this so at a store where you’ll never shop. Plus, not all businesses will give you the option to receive a refund as store credit.
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