Tax attorney, Jasmine DiLucci, has issued a warning about the misunderstanding of the IRS's approach to credit card rewards, which are often mistakenly treated as free money. This misunderstanding can lead to unexpected tax exposure for business owners and real estate investors using their credit cards for deductible expenses. The issue lies in how cash back is treated under separate tax rules, which can significantly impact business tax calculations. Most rewards are not taxed in practice due to a separate IRS policy decision in 2002, which stated it would not pursue tax enforcement on frequent flyer miles and promotional points due to administrative and valuation difficulties. However, this decision is not permanent and the IRS has the right to change its position in the future.