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Generally card rewards are treated as non-taxable rebates or discounts on the price of merchandise purchased. Airline miles are also viewed in much the same way by the IRS; as are rebates offered on new car purchases.

The only credible issue I have seen raised regarding cash back credit card rewards:

1) If you use a card to purchase items that are deductible (i.e. - business expenses) then you receive a rebate based on those purchases, then, theoretically, you have reduced the basis (cost) of those items and that would need to be considered when calculating the business expenses deduction for your taxes.

Less complicated, perhaps, but similar is that I have read that:

2) If you obtain a free airline ticket because of miles accumulated for business travel; the expenses for which were claimed as a business expense, and then the free ticket is used for personal use, then the value of that ticket is, again theoretically, taxable. (I assume the same may hold true for 'free' hotel stays, etc.)

Ultimately, the IRS doesn't seem to have a stated position on this, even in those cases.

For most people, there simply isn't an issue with getting 'gifts', rooms, flights, or even cash back rewards from various programs. The only potential issue seems to come in when accumulating those rewards via purchases that you deduct as business expenses.