My guess is that you don’t like paying taxes.  I don’t blame you.  Fortunately, there is a silver lining.  Paying taxes via credit card can be quite rewarding. The key is to earn credit card rewards that more than offset tax payment fees. For example, if you’ve signed up recently for a card that requires large spend to get a big welcome bonus, paying taxes via credit card can be the solution.

Here’s everything you need to know…

Pay taxes via credit card

Important due dates

  • January 15 2020: 4th quarter estimated taxes for 2019
  • April 15 2020:
    • Final 2019 taxes due
    • 1st quarter 2020 estimated taxes
  • June 15: 2nd quarter 2020 estimated taxes
  • September 15: 3rd quarter 2020 estimated taxes
  • January 15 2021: 4th quarter 2020 estimated taxes

Pay taxes via credit card: Background

Here is key information you’ll need to know about paying taxes with credit or debit cards:

Credit card fee 1.87% to 1.99% (or 2.5%): The IRS maintains a list of companies that accept credit and debit cards towards tax payments. You can find the current information by clicking here. Currently there are three separate payment processing companies on the list. At the time of this writing, debit card fees range from $2 to $3.95 per transaction and credit card fees range from 1.87% to 1.99%. Alternatively, you can pay taxes via the Plastiq Bill Pay service, but that will cost you more: 2.5%.

Two payment limit (per processor): The IRS maintains a table of frequency limits for paying taxes via credit or debit card (found here). In general, they say you can make up to two payments per tax period per type of tax payment. For example, you can make 2 payments every quarter to your quarterly estimated taxes, and you can make 2 payments every year to your annual taxes. Important: In my experience, these limits are enforced per payment processing company. That means that you can really make up to 6 payments per tax period per type of tax payment (or more if you make Plastiq bill payments as well). An IRS advisor I spoke with several years ago did not think that there would be any problem with making more than 2 payments by using different processors. Since then, I have made more than 2 payments per tax period many times and never had any issues. That is, of course, just my own personal experience. I can’t guarantee that your outcome would be the same.

No cash advance fees: I’m often asked whether credit card companies charge cash advance fees when paying taxes by credit card. The answer is no. All three payment processors agree (via their FAQ pages) that the payment is treated as a purchase not a cash advance. You can find FAQ info here, here, and here.

Unlimited payments via Plastiq: If you’re willing to incur slightly higher fees, you can make an unlimited number of tax payments via the Plastiq bill pay service. Plastiq usually charges 2.5% to pay bills (including taxes) via credit card, but they occasionally offer lower fees via short term promotions. For details, please see: Plastiq Bill Payment Service.

To pay taxes via Plastiq, use Plastiq’s tax payment screen:

Fees no longer deductible: Tax preparation fees used to be deductible when itemizing deductions for personal tax returns, but that is no longer the case. That said, businesses can treat processing fees as legitimate business expenses which will, in turn, reduce the tax burden to the extent that these charges reduce overall profits.

View tax payment history: Once you’ve made payments through online processors, you may want to see proof that the IRS received the amount you sent. You can view past payments by signing up here:

Reporting estimated payments: Estimated payments should be reported when filing your annual taxes. In my experience, if you make a mistake and forget to report some of these payments, the IRS will catch the error and refund the difference.

Paying end of year taxes: Tell your tax preparer or tax software that you’ll pay via check. Then, browse to the appropriate tax payment site (e.g.,, or to pay your taxes. There is no need to mail in the 1040V payment voucher.

Samsung Pay & Google Pay

Some tax payment websites support mobile wallet payments such as Samsung Pay or Google Pay. The US Bank Altitude Reserve card earns 3X for mobile wallet payments, so it should be a great match. However, readers have reported that Samsung / Android Pay (Google Pay) are only supported through Visa Checkout and that this does not trigger the Altitude’s 3X rewards.

Amex Express Checkout

Since Amex is strict about not counting manufactured spending towards new credit card welcome bonuses, tax payments are a great alternative. The nice thing about Amex Express Checkout is that you can use it to make payments even if you don’t have your card. If you recently signed up for a new Amex card and added it to your online account but haven’t yet received the physical card, you should still be able to…

Continue Reading: Source Link


Please enter your comment!
Please enter your name here