We recently learned about major changes coming to Bilt, including the introduction of three new credit cards, plus a new way to award points for housing spending (read my Bilt credit card review & comparison). The changes haven’t exactly been well received, including due to the complexity of the new system, so Bilt already made changes within days of launch (arguably adding even more complexity, but that’s a different story).
In this post, I’d like to focus on one specific frustration that I have with the new card concept. It won’t impact everyone, but I think for those of us who do value this as a way to generate points, it’s pretty noteworthy.
In this post:
Bilt won’t award points on credit card tax payments?!
If you look at the terms of Bilt’s three new credit cards — the no annual fee Bilt Blue Card, $95 annual fee Bilt Obsidian Card, and $495 Bilt Palladium Card — you’ll see a section about what constitutes an eligible purchase for the purposes of earning points on credit card spending. Here’s the relevant part:
“Eligible Purchases” or “Purchases” means transactions for goods or services and Bilt Housing Payments made with your Bilt Card, minus returns, refunds, or credits. The following purchases do not qualify as “Eligible Purchases” and do not earn Bilt Points or Bilt Cash: Balance transfers, special transfers, cash advances, cash withdrawals, card check transaction, instant loan, travelers checks, money orders, wire transfers or similar cash-like transactions, prepaid cards, gift cards, person-to-person payments (such as Venmo, PayPal, Cash App, or Zelle), tax payments (except property taxes included as Bilt Housing Payments), cryptocurrency or other digital currency purchases, fees or interest posted to your Card Account (including annual fees, late fees, and returned payment fees), lottery tickets, casino gaming chips, race track wagers or similar betting transactions, and checks that access your Card Account.
What stands out to me the most is that you can’t earn points on the cards on tax payments. For those of us who are self-employed and make our own quarterly tax payments, there are services out there that let us pay taxes by credit card in exchange for a fee of around 2%.
To be clear, this isn’t “gaming,” or anything like that. Literally not a single major card issuer has rules against this, and I’ve used cards from American Express, Capital One, Chase, Citi, etc., toward tax payments.
However, at least based on the terms, Bilt is going to have the first credit cards I know of that specifically carve out an exception for this. I reached out to a Bilt representative a few days ago to confirm that this is in fact the intent, and I never heard back, so I figure it’s time to cover this.
I think this gets at the frustration people have with Bilt
I don’t want to suggest that the tax payment exclusion specifically is what’s wrong with Bilt, but I think these kinds of carve-outs sum up the frustration that many members are feeling with all these Bilt changes.
Bilt isn’t some small, scrappy startup — instead, it has a valuation of over $10 billion. While Bilt executives will claim that the company is way more than a credit card, I think most reasonable people would agree that the thing that made Bilt gain traction was rewarding rent payments without fees.
Many of us said that the initial concept wasn’t sustainable, but Bilt executives insisted the company was already profitable, and suggested it was sustainable… until it wasn’t. Of course now we see some people at Bilt essentially suggesting that those who were earning rent rewards while making five small purchases per billing cycle were “cheating” the system, when in fact, that was the literal value proposition the company promoted.
What does this have to do with the tax payment situation? Well, Bilt now promises that the Bilt Palladium Card will be one of the most rewarding cards for everyday spending, earning the most valuable points currency there is. That caused many people, like me, to get the card, as 2x points on everyday spending is awesome.
But then you start to learn that apparently Bilt doesn’t actually want to offer 2x points across the board, and creates exclusions that you won’t find with any other cards. It contributes to the overall feeling of Bilt basically trying to claim it’s the most rewarding in every way, while carving out exceptions.
If Bilt is getting the typical interchange fees for tax payments, then why does the company feel it can’t reward those payments like any other purchases? Is even that model not sustainable, or how else can one rationalize that?
I’m happy to give the Bilt Palladium Card a try, thanks to the welcome bonus, and in anticipation of learning how Bilt Cash will work (since that’s a major unknown as of now). But justifying the $495 annual fee may be difficult:
- An incremental Priority Pass membership gets me very little value
- Up to $400 in hotel credits, each of which is a $200 semi-annual credit requiring a minimum of two nights, is really a chore to use, especially for those of us who already have many cards with many hotel credits
I figured “okay, well maybe my rewards for everyday spending will help me justify the $495 annual fee.” But then you learn about the unusual exclusions, which are just sort of frustrating.
Bottom line
Bilt is launching three new credit cards in partnership with Cardless. While they’re probably not going to be as rewarding as the old card, there’s still potentially merit to picking up one of them. What I’m finding frustrating is how there are quite some “catches” to maximizing value.
Among those is that Bilt’s credit cards reportedly can’t be used for tax payments, for those services that allow tax payments with a fee. There’s not another major credit card with an exclusion like that, so it just strikes me as a bit of a “gotcha,” especially when you’re promoting a card that’s supposed to be unparalleled for everyday spending.
Anyone else frustrated by this tax payment exclusion?
I’m chatting with the AI agent in the Bilt app and asked the following…
“Can I pay my estimated taxes with my Bilt card and still earn points?”
To which it replied, “Yes, you can pay your estimated taxes with your Bilt Card 2.0 and earn points on those payments.
These tax payments are considered everyday spend, so you'll earn points or Bilt Cash based on the rewards option you select for...
I’m chatting with the AI agent in the Bilt app and asked the following…
“Can I pay my estimated taxes with my Bilt card and still earn points?”
To which it replied, “Yes, you can pay your estimated taxes with your Bilt Card 2.0 and earn points on those payments.
These tax payments are considered everyday spend, so you'll earn points or Bilt Cash based on the rewards option you select for your card.
If you want more details on the earning rates or how to maximize rewards for tax payments, let me know.”
I asked the same and told me "no you cannot earn points for paying federal estimated taxes with the bilt palladium card"
This is why I will not be participating in this card or at least not yet. They do not easily tell you who the transfer partners are and they make the rules and the reward structure too complicated.
Hi Ben,
Does this mean even mortgage tax payments will be excluded? I use my bank to escrow, so when I linked my card with the bank through Bilt in anticipationfor mortgage payments, how will Bill know the proportion of mortgage is taxes versus actual mortgage gauge?
After the initial shock, and ultimately selection of Palladium for me, I’m trying my best to not even think about BILT again until February 7. Like, if they wanna release more updates, frantic emails about new ‘options’ or whatever, go for it. See you jokers in February!
It’s really as simple as this: Bilt can’t afford to be as rewarding as they were and, probably more importantly, as rewarding as they’d like the public to perceive them to be. They’ve gone on “tour” in the blogosphere allowing the usual suspects to fellate Bilt but at the end of the day, this is a program full of potholes and exceptions and weird rules and you’ll never as good of a reward as you expect. Jokers, all of them.
Totally agree - hope BILT will revise. 1.0 tax payments were ok
Totally agree Ben. I first applied thinking I’d easily put all my estimated taxes on Palladium and get 2x points then transfer to Hyatt / Alaska. Was super excited then read that they won’t reward. Don’t understand why every other card lender does give points. Frustrating
I had been waffling on what to do with the transition to Bilt 2.0, and this is just the nail in the coffin.
Ben - I think you may have pulled the trigger on applying for the Paladium card too quickly. I agree with your assertion that "If Bilt is getting the typical interchange fees for tax payments, then why does the company feel it can’t reward those payments like any other purchases?" I am still on the fence about Bilt 2.0 cards until I know whether my tax payments will earn Bilt points.
Im totally with Ben. Tax payments are a main source of spending that i was counting on with the palladium.
So, I guess my - very sincere - question is whether there's a point you're going to openly suggest pure card bonus churning with Bilt? Or even just outright advising /against/ bothering with Bilt?
"it has a valuation of over $10 billion" - I'm betting this market cap is going to be their peak in the rear view mirror. I can't see them thriving with all the negative press around these changes.
I have Platinum Bilt status till next year - does anyone know if I don’t get a Bilt 2.0 card , would I be still able to get monthly transfer bonuses ( if any ) and 3x Atmos rent points when paying with a check ?
Thanks in advance !
Yes you should. The program and the credit card are separate in terms of status; you dont need the credit card to hold status or earn points within the program.
Why is 2x funny-money BILT points on everyday spending "awesome," but no blogger ever mentions the Wells Fargo Active Cash card that pays 2% real cash back on everyday spending?
I think most points collectors try to get some outsized value from points, I always aim to redeem at above 1 cent per point.
I am not really sure what the fuss is all about. I was surprised that I didn't get any points for pay taxes with the existing Bilt card (the WFC one) either, so this is just a carryover (although more explicit in the T&C).
Of the dumpster fire that we have witnessed over the past week with the launch of this card, this was literally one of the most important but least covered topic and I am glad you are shining a light on this. This makes the excess value proposition of this card very questionable and the ability to make this your primary card and potentially getting rid of VX1 or CSP, highly unlikely.
Maybe you can get Bilt to change this or at least explain why they've excluded them.
I understand the move from their side. The shame is that the value proposition from the consumer side gets more complicated. The sell of the Palladium Card is that it can be your only card. 2x. MC. No FTF. Unless you are a Costco enthusiast, there's no need for anything else. Excluding tax payments probably doesn't affect most normal people (paying a fee for points was something I never considered before diving into the blogs)....
I understand the move from their side. The shame is that the value proposition from the consumer side gets more complicated. The sell of the Palladium Card is that it can be your only card. 2x. MC. No FTF. Unless you are a Costco enthusiast, there's no need for anything else. Excluding tax payments probably doesn't affect most normal people (paying a fee for points was something I never considered before diving into the blogs). But excluding subsections of Amazon, Ebay, and Etsy from earning points will make normal people cringe. You have to have a backup card for this type of transaction, or you have to be oblivious to earning points. And trying to explain to someone that the transactions are excluded because of creative spending risk? Good luck with that.
If the card is a niche card for dining or for some travel purchases, then fine. But if you want the bulk of everyone's transactions, you have to make it easy to just set it and forget it. The CSR made this mistake by cutting the definition for travel to just flight and hotel. You lose all the people using OTAs, VRBO, or booking cruises. This is why I've liked the travel category on some Chase cards and the broad application of 3x categories on the C1 Savor: I don't want to have to worry about weird exclusions from specific merchant codes. It is also why the USBAR was never an attractive travel card for me and the Amex Gold is not an attractive grocery card. I know it is a balance, but I think erring on the side of consumer simplicity (even if you have to reduce reward rates slightly) is the better move. The VX is 2x on everything -- no exclusions. They balance things on the redemption side with the weird transfer ratios to select partners. That's probably the better move, as you are only annoying the subset of the membership already willing to do math.
Why do they exclude eBay? To me as a customer - eBay is just as legitimate purchase as if I purchased the same item from Amazon or Walmart. I don't see any reason why would they exclude it. Does it mean they will have more exclusions?
Following. I didn't think eBay was a place that could be easily games. Is this to stop buying groups?
eBay has negotiated processing fees with Visa and MC. It’s likely similar to Amazon (.0088) or so making those transactions a loss. Same with taxes.
2.0 is just as unsustainable as 1.0. they will be looking for a new bank in a couple of years. That's why there are so many rules to prolong the inevitable. Awarding points for rent was the dream of a couple of drunk points guys that managed to sucker in some VCs with money to burn.
Robinhood Gold card does the same thing regarding taxes. Everyone needs to discourage this practice by not using these cards.
@Ben it's because the approved IRS processors have a fixed rate (about 88 basis points or so). My fear is the "marketplace" provision and them including amazon because AMZ has a set rate of about 80 basis points or so. Same deal with eBay.
Which btw- kills their entire CCCA arguments. Big retail is already paying way less than Main Street USA businesses.
Tax payment processors are charged lower interchange fees, so it isn't really surprising that some reward card issuers wouldn't offer the same rewards on such payments.
except, pretty much everybody else actually does pay out the same rewards on those exact same payments.
Bilt and/or Cardless are probably not in the same position as some of the other major issuers to be able to absorb the losses on such payments. The reward payout is also higher in Bilt 2.0 than those from other issuers in this unbonused but less profitable category.
Are Property Taxes excluded?
Another one here to complain about excluding online marketplaces such as ebay. Then again, when the guy running the rewards side of Bilt is the same one who scammed AA mailers for years, not surprised he thinks everyone is out to scam Bilt.
Tax payments, annoying but it's not a dealbreaker for everyone. What is starting to piss me off is now saying they won't reward purchases on eBay and Facebook Marketplace. I shop vintage items on eBay as much as a do a physical antique shops. Who is to say that next they're not going to allow you 2x points on, whatever they decide tomorrow. It just leaves a bad taste in my mouth to have all...
Tax payments, annoying but it's not a dealbreaker for everyone. What is starting to piss me off is now saying they won't reward purchases on eBay and Facebook Marketplace. I shop vintage items on eBay as much as a do a physical antique shops. Who is to say that next they're not going to allow you 2x points on, whatever they decide tomorrow. It just leaves a bad taste in my mouth to have all these changes before I've even received my new card. I was excited to make this card my daily driver and have a list of cards I WAS planning on closing to replace with this but now I'm holding off. Bilt, lose my trust, lose me as a customer for good.
Agreed. None of the categories excluded by Bilt affect me, so it’ll make no difference on the value proposition for now. But who knows what they’ll add to this list, or how other issuers may see this and start adding their own exclusion categories. Bad optics on top of bad optics.
Work around eBay gift cards at grocery stores. I do that anyways now for large purchases as it also gets grocery store points.
Von. Get the Wells Fargo attune card. 4% cash back on eBay
USAA has this provision also. I was burned by it about a year ago. Expected to get travel points in their program, and after my 90 days was up when they hadn’t been awarded, I was informed that the tax payment I made didn’t count. It was in the terms and conditions, but I hadn’t noticed it.
Ben, what about the language regarding a claw-back of the SUB for misuse, including
- Canceling, downgrading, or closing your Bilt Card Account within 12 months after your Account Open Date;
Are they going to try and stick everyone with a second annual fee if the card is not working out for them?
It's been said by others that Cardless currently does not allow product changes on any of their cards. Plus they are stingy in refunding annual fees. So the palladium sub could actually be $990 for 50k bilt pts. Something to think about for those who want to try it out for a year or churn the sub.
Just liquidate the points then cancel not like Amex or Chase where you want to stay in their ecosystem with other cards
Ben, seems like this risk warrants a separate post...would love to see you take the issue head-on!
"An incremental Priority Pass membership gets me very little value."
Why so soft? It gets you ZERO VALUE. Let's be honest in here, come on.
For those that can’t justify the CSR, i look at these incremental PP memberships (I have 5 at this point) as getting 2 day passes into the Sapphire lounge, so I’d say ~$40-50, depending on how you personally value lounge passes.
Maybe it’s only on t&c? Amex reps often say tax payment isn’t count for signup bonus spending - maybe it’s written somewhere but we know tax payment always works on Amex.
Beyond lame. They still earn interchange, albeit less, presumably given the consumer fees are less than 2%. But a major complication (as usual from Bilt) that will make it easy for me to say nope to these already complicated cards. Not even sure why the eBay restriction - buying a few trading cards or something is non point earning?!??
Hi Lucky, I've noticed you using the adjective "incremental" a few times in your blog posts. Could you please help me understand what you mean exactly by "an incremental Priority Pass membership gets me very little value" - do you mean that you already have an existing Priority Pass membership and therefore getting it for a second time via Bilt adds little or no value for you? (Not saying that you are wrong, just that...
Hi Lucky, I've noticed you using the adjective "incremental" a few times in your blog posts. Could you please help me understand what you mean exactly by "an incremental Priority Pass membership gets me very little value" - do you mean that you already have an existing Priority Pass membership and therefore getting it for a second time via Bilt adds little or no value for you? (Not saying that you are wrong, just that I don't often come across this usage of the word in British parlance!)
@ ChampagneSocialist -- Sorry if that wasn't clear. My point is that I already have several premium cards that offer a Priority Pass membership, so one extra membership doesn't really get me any additional value.
Ben has multiple PP memberships from multiple cards. Amex Platinum, Amex Business Platinum, Venture X, Venture X Business, Chase Sapphire Reserve, Chase Sapphire Reserve Business, Citi Strata Elite. What incremental value would yet another PP membership add to what he already has? The same concept can be applied to other things. What incremental value does Bilt Cash provide above (say) the Capital One Venture X? Or, anything added to what one already has?
Now I'm curious as what little incremental value another priority pass membership has at all. I have several too and can't find any use over just having one. Or was that meant to say that it is of no value, period.
Only value would be the single annual visit each PP card gets you a Chase Lounge, and for many that’s zero.
Incrementally more incredulous when you're still stuck on the PP lounge wait-list and they're boarding your flight .. hahaha!
That BILT 1.0 shine sure is fading quickly in the last week or so….there’s a short term gap for another startup to temporarily steal their spotlight with another VC funded, unsustainable business model.
Spot on. Very frustrating and causes me to pause as I consider my BILT plans. BILT 2.0 would replace my C1VX if 2.0 didn’t carve out tax payments. Sucks they are excluding tax payments.
Although, I don’t think they are alone. Robinhood’s gold card, which is near impossible to get, excludes tax payments from its 3% cash back. as well
I am in a similar situation. Excluding tax payments . . . and marketplaces . . . and the uncertainty about the realizable value of Bilt Cash? I'm going to stick with my Venture X. Too many exceptions with Bilt 2.0.
"Online re-sale marketplaces" - who counts? We know eBay and FB, but what about Etsy? Amazon?
Throw in Poshmark.