Do You Pay a Fee to Transfer American Express Membership Rewards Points to an Airline?

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Million Mile Secrets reader Julie commented:

I transferred 50,000 points to Delta from my American Express Gold and they charged me about $30.  I’ve never heard you (or anyone else) mention that they do this.  Is this your experience also?

Julie wants to know why she was charged a fee when she transferred her American Express Membership Rewards points from her Premier Rewards Gold Card from American Express to Delta Airline miles.  American Express charges a fee to transfer miles because they have to pay an excise tax to transfer the miles.  So they pass along the costs to you, the cardholder. 

American Express Membership Rewards Points

Link:   American Express Premier Rewards Gold card  

Link:   American Express Membership Rewards  

Julie earns American Express Membership Rewards points when she uses her American Express Premier Rewards Gold card.  Julie could also earn American Membership Rewards points from the American Express Mercedes-Benz Platinum card, The Platinum Card from American Express, and The Business Platinum Card from American Express OPEN cards.  As always, terms and limitations apply with American Express cards.

Julie can use her American Express Membership Rewards points to:

• Travel using Pay with Points
• Redeem for gift cards
• Redeem on Amazon
• Transfer to hotels 
• Transfer to airlines

Turn Points Into Miles

Julie can transfer her American Express Membership Rewards points to ~17 airlines, including Delta Airlines.

There is no limit to the number of American Express Membership Rewards points Julie can transfer.  But American Express Membership Rewards points must be transferred in 1,000 point increments.

Julie will pay an excise fee when she transfers her American Express Membership Rewards points to US airlines.  Because the fee is a federal fee taxed on US airlines, Julie would pay the fee even if she lived in another country.

There is no fee to transfer American Express Membership Rewards points to hotels.  Julie can transfer her American Express Membership Rewards points for free to these hotels:

• Best Western
• Choice
• Hilton
• Starwood

Julie will be charged a fee of 0.06 cents per point up to a maximum of $99 when she transfers her American Express Membership Rewards points to a US airline.

So Julie will pay a fee when she transfers American Express Membership Rewards points to these US airlines:

• Delta Airlines
• Frontier Airlines
• Hawaiian Airlines
• JetBlue
• Virgin America

The 50,000 American Express Membership Rewards points she transferred to Delta Airlines cost $30 to transfer (50,000 points x .06 cents per point transfered).

The most Julie will pay to transfer American Express Membership Rewards points is $99, even if she transfers 500,000 American Express Membership Rewards points!  Because that’s the maximum amount American Express charges to transfer points.

But there is no fee if Julie transfers her American Express Membership Rewards points to foreign airlines, like British Airways.  Julie can transfer her American Express Membership Rewards points for free to these airlines:

American Express Membership Rewards points usually transfer within ~2 days but can take longer depending on the airline.

Interestingly, you can transfer Chase Ultimate Rewards points and Starwood Preferred Guest points to US airlines for free.  I’m not sure if these airlines get around the excise fee, or if they incur the fee on behalf of their cardholders.

Bottom Line

Julie paid a $30 fee to transfer 50,000 American Express Membership Rewards points to Delta Airlines.

American Express charges an excise tax recovery fee when you transfer American Express Membership Rewards points to a US airline.  Julie will pay .06 cents per point to transfer American Express Membership Rewards points.  The maximum fee that Julie will pay is $99.

Julie won’t pay the fee if she transfers her American Express Membership Rewards points to a foreign airline.