Question 1

How do credit card welcome bonuses work?

Accepted Answer

A credit card welcome bonus is an incentive offered by card issuers to new cardholders who meet a specified spending threshold within an introductory timeframe (typically 90 to 180 days). Bonuses are delivered as cash back statement credits or loyalty points redeemable for travel, gift cards, or merchandise.

Question 2

What is the Chase 5/24 rule?

Accepted Answer

The Chase 5/24 rule is an unwritten underwriting policy where Chase will automatically deny applications for most personal credit cards if the applicant has opened 5 or more personal credit cards with any bank in the preceding 24 months. Most business cards do not add to your 5/24 count.

Question 3

Are credit card bonuses and bank account bonuses taxable?

Accepted Answer

Credit card welcome bonuses are classified by the IRS as purchase rebates and are generally 100% tax-free. In contrast, bank account signup bonuses are treated as taxable interest income. Banks issue Form 1099-INT for cumulative bonuses of $10 or more in a calendar year.

Question 4

How does Churnable calculate points valuations?

Accepted Answer

Churnable converts loyalty currencies into estimated USD using conservative redemption rates (typically 1.0¢ to 1.5¢ per point for transferable currencies like Chase Ultimate Rewards and Amex Membership Rewards; 0.5¢ to 0.8¢ for hotel and budget airline programs) to reflect realistic net payout rather than inflated marketing figures.

Question 5

Does opening multiple credit cards hurt your credit score?

Accepted Answer

Applying for a card generates a temporary hard inquiry (typically a 3 to 5 point drop that recovers within 2 to 3 months). Over time, opening cards increases total available credit and lowers overall credit utilization, which frequently raises your credit score provided balances are paid in full on time every month.