I've been receiving MGM Rewards resort credits as part of my Offers for several years now However, I've always been uncertain regarding this specific question: As I spend down my resort credit, I keep track of each restaurant bill which includes the 8.3% tax, while obviously not being able to charge any tips as part of the resort credit Let's say I have $100 left on my resort credit before reaching my $300 offer limit > IF my bill is 99.99 + $8.30 tax > does my room charge then show owing the $8.30 tax on this final $99.99 of my resort credit spent? OR does my resort credit cover this FINAL restaurant charge which uses up my remaining balance without the extra $8.30 taxes then owing? I realize that previous restaurant bills charged to my room will include the taxes and count against my total resort credit balance, but am wondering about that final charge to bring my RC basically down to 0 owing before the final bill taxes Thanks for your thoughts!
All charges will be treated identically. There are no interesting considerations with respect to the manner in which you are describing the usage of the RCs.
Got it > thanks! My confusion stems from the fact that I've read previous posts which stated that if you had a $300 resort credit, for example, and your dinner bill was $299 before the 8.3% taxes were then added > you would only be charged $299 without the taxes added on your room charges folio owing > Never sure IF this specific example was actually correct? That;'s why my own specific example involved my final restaurant room charge which would almost entirely exhaust my remaining resort credit before 8.3% taxes were then added to this final bill
You don't owe or pay tax on any portion of a charge that is covered by resort credit. Tax is not paid for by (or use up) resort credit, the tax simply ceases to exist if the entire F&B portion is covered. You DO pay tax on any uncovered portion, but only the uncovered portion. If you had $300 in resort credit and the food and beverage portion of your bill at Restaraunt ABC was $299.99, nothing should show up on your folio, except the tip if you added it to the bill. You would have 1 cent left in resort credit. Same $300 in resort credit but your food and beverage was $350, your folio would show: Restaurant ABC Food $50.00 Restaurant ABC Tax $4.19 (representing 8.375% of $50) Restaurant ABC Tip $ (whatever you put on the bill as a tip) ETA: @Raymond_W says below that he has tracked this question more closely than I have and that tax IS assessed on the full amount of a resort credit charge and is paid for out of the resort credit. So in doubt, I would assume in that direction unless proven otherwise.
Also - to help keep track that all charges hit the folio, I include the tip on the "room charge". that way I know it hit my account. then pay the tip with whatever credit card later.
have you found that those hit at the same time? I always thought the main charge hits immediately and the tip hits when the person in the accounting dungeon goes through all the receipts for the day.
THANKS! Just so I'm totally clear on my understanding of this subject...Let's say I have a $200 Resort Credit > typically what I've done in the past is kept close track of my restaurant room-charges by each meal, including the 8.375% tax *(fully understanding I must pay tips myself not covered by the resort credit) So if my THREE room-charged meals were: $60 + $5 tax ($65.00 total)...$80 + $6.65 tax ($86.65 total)...$45 + $3.75 tax ($48.75 total) > What I've always thought is that those 3 charged meals, including tax, totaled $200.40 > meaning my resort credit was fully used. BUT > Should I actually be reading my resort credit usage as just being the 3 restaurant room-charge amounts > PRE-TAX > meaning I've really only used $60 / $80 / $45 > $185 total pre-tax, with $15 resort credit then still remaining??
Wow > good to know > thanks! So this upcoming trip with my $300 resort credit, I should keep track ONLY of the restaurant room-charge amount, NOT including the 8.375% tax tacked on to the total of each bill!
By law, what you state should be true. In practice this is not true of MGM. MGM absolutely does not omit tax when you room charge and debit from RCs. I stay at a Vegas MGM property twice a month and I track my RC usage every single time. Every single time, I start to pay with my own money once the post tax total of all of my charges exceeds my RCs.
Yeah I always thought if you room charge to use your resort credit at MGM, it uses the tax towards the total also. Now if you use your players card and use your points, the tax will disappear.
Hmmm > I'm really glad I brought up this specific subject for discussion! Initial poster comments seemed so certain, but now I'm glad to learn that I haven't wasted any potentially unused resort credit from many previous Offers when I always included the tax in counting down my room charges!
Interesting. I get varying amounts of resort credit and usually only use it all when I stay at Aria, Vdara or Bellagio because those are the smallest amounts. I thought I tracked it in my head closely enough to tell that tax wasn't being paid via resort credit but I'll have to track it more exactly next time. I agree that the if the charge is comped at the time of the transaction, the tax should not be assessed. That's how it works if you pay with points at the point of purchase. The charge is zeroed out, so there's nothing to tax. It should work the same with resort credit.
I wonder how this works between MGM and the state of Nevada for purposes of sales tax reporting. So if MGM reports to the state any transactions they give their customers "free" as a gift, I assume MGM is not actually paying sales tax to the state of Nevada on these gifts, correct? The state itself does not care about how it was free/comped - whether it was done with points, or with resort credit, or a pit boss giving a food voucher to a table player, free blanket "earned" with points, etc. One could then argue that MGM is cheating us out of 8.38% (the sales tax rate) of the advertised Resort Credit they are giving to us, because they are not paying 8.38% of that to the state? They are keeping that portion in their own pockets? Are there any other properties (Caesars, Boyd, etc.) that do not "charge" us sales tax when the resort credit covers the entire portion of a charge?
I checked the folios from my last few MGM trips, where I always charge meals to my room. The resort credit was applied in two separate ways on each folio, but the tax treatment was the same. On one trip I used my entire resort credit on a dinner on my first night. The resort credit covered most but not all of the bill (my receipt showed the full charges). On my folio, there is a charge for the remaining portion of the bill after the full resort credit is applied, and a charge for the tax on the full amount of the bill. On another trip I ate at several restaurants over the course of several days, and the full charges including tax, appear on the folio as entries on the day of each meal. The resort credit was applied on the last day of the trip, where on the folio there are negative entries for each of those charges, including negative entries for the tax. So, it appears that in instances where the transaction at the point of sale reflects charges and taxes, the guest pays for both, with the resort credit being applied later as a credit against both the charges AND the taxes. YMMV. I don't see anything in the MGM T&Cs that would run contrary to this. For meals or other items that are fully comped at the point of sale, there are no taxes, because technically the sale value is $0.00. It's like the meal never happened, except for the crumbs and spilled wine. On a related note, if the bill is $0.00, in some places a nominal charge of 1 cent has to be rung up if the guest want's leave a tip via credit card. Again, YMMV, but this is what I'm seeing...and honestly I never looked at it until this thread!
IMHO. I believe Nevada has flip flopped on this a few times, but the last ruling was comped meals were not taxable in 2013. Now if its flipped again to taxable, then no idea. Its gotta be one way or the other and not this sometimes yes sometimes no stuff.
No, nothing has changed. Comps and Resort Credits are two separate things (at least in the context of this thread, which is MGM Resort Credits). If a meal is comped upfront or at the point the charges are rung up, then it's not taxable. Resort Credits are applied as credits to pre-existing charges, and pre-existing taxes.
I'd still say its just someantics here then (misspelling intentional). CET used to be the same at what you're describing but they changed it ages ago. I am sure that they reverse out the taxes on room charges that are resort credit covered for CET these days.
I am looking at it from a business standpoint - between MGM and the state of Nevada. If they are "collecting" sales tax by taking it out of the resort credit, they should be giving that to the state of Nevada, correct? I doubt they are though. I have several fast food reward apps on my phone (Wendy's, KFC, McDonald's). You earn points with each purchase. Then you can use those accumulated points to redeem free food items, with no sales tax charges. These companies are throughout the USA. That tells me all states do not make any businesses pay sales tax if the business gives a customer a free item (whether it is free through a good gesture, or free through a rewards program). My main point is that MGM is cheating us out of the advertised resort credit in our offers. $500.00 resort credit is really only about $460.00, when you factor in they are taking out 8.38% for tax and NOT paying that to the state, and "keeping" it themselves.
