Mar 18, 2016, 8:54 am
Last edit by: Boraxo
There are three services to pay your U.S. federal taxes: IRS Pay Your Taxes by Debit or Credit Card or Digital Wallet
pay1040.com 1.87% fee on credit (lowered from 1.99% on 01/02/2023). $2.50 flat fee on debit.
payUSAtax.com - 1.82% fee on credit (rate updated 01/03/2024 from 1.85%). $2.20 flat fee on debit.
Many states also permit online tax payment; check with your state or this list from MasterCard.
The IRS has a system to view payments, and it's good practice to confirm all payments within a short time frame, so that any rare lost payment issue can be disputed.
Be mindful of time zones if paying on the due date as pay1040.com uses CDT timestamp and payusatax.com uses EDT timestamp.
In general, you're allowed 2 payments per processor above per type of tax (annual and quarterlies being 2 different types, for example). They're not billed as cash advance fees. If 6 payments is not enough to pay your bill you can use a service such as plastiq (2.25% fee). If making multiple payments, it is advised you join here to track your payments link , you will be required to give your banking information and will receive a pin via snail mail
(Confirmed 4/2018 in post #429)
Fees are tax-deductible for C-Corps but not individuals (2018 tax reform eliminated "miscellaneous itemized deductions"). The majority of people will not be able to deduct that expense, check with your accountant.
When making multiple payments at or near your credit limit multiple times, allow yourself 3-5 days between payments for the charge to show up on your card and your bank payment to clear. If you wait until April 15th to make payments, you will only be able to clear the first payment.
Best Credit Cards to use/buy cheap points:
- Any credit card to hit minimum spend and achieve signup bonus or spend thresholds.
- BOA Premium Rewards 2.62% Cashback (Card holder needs to be a Preferred Rewards Platinum Honors member)
- Chase INK Premier 2.5% Cashback on purchases over $5k (Points are not transferable to airline or hotel programs)
- Capital One Venture X 2X Cap One Miles/Points (now transfer to most airline partners at 1:1)
- Amex Blue Business Plus 2X Membership Rewards (capped at $50,000 spend per calendar year)
- Chase United Business Club Card, 1.5X United Miles
- BOA Virgin Atlantic World Elite 1.5X Virgin Atlantic Points
- Chase Freedom Unlimited, 1.5X Ultimate Rewards, paired with a premium card (Sapphire Preferred, Sapphire Reserve, INK Preferred, INK Plus)
- Chase INK Unlimited, 1.5X Ultimate Rewards, paired with a premium card (Sapphire Preferred, Sapphire Reserve, INK Preferred, INK Plus)
- Amex Everyday Preferred 1.5X Membership Rewards, (need to make 30 transactions in a month for 50% bonus)
- Amex Business Platinum 1.5X Membership Rewards on purchases over $5K
Big Spend Bonuses:
- Amex Delta Reserve, spend $60k get 30k bonus miles and 30k MQM
- Citi Hilton HHonors Reserve, spend $10k get free weekend night, $40k, Platinum Status
- Chase Southwest, spend $135k get Companion Pass (WN points are redeemed at $.011, @ 1.87% fee, you're essentially buying the companion pass for $847)
- Chase Ritz Carlton Reserve, spend $10k get Gold Status spend $75k get Platinum Status
- Chase World of Hyatt, spend $15k get one free night
Cash Back cards:
Elan Fidelity 2%
Citi Double Cash 2%
Earn Status/Elite qualifying points:
- American, Delta, Alaska, Hyatt
Pre-Funding allowed:
Amex Charge Cards
Pre-Funding not-allowed:
Chase
Quarterly tax due dates: the 15th of April, June, September, January
pay1040.com 1.87% fee on credit (lowered from 1.99% on 01/02/2023). $2.50 flat fee on debit.
payUSAtax.com - 1.82% fee on credit (rate updated 01/03/2024 from 1.85%). $2.20 flat fee on debit.
See this thread about payUSAtax customer service. Many people have reported that they never respond to support requests.
ACI Payments, Inc - 1.98% fee on credit. $2.20 flat fee on debit.Many states also permit online tax payment; check with your state or this list from MasterCard.
The IRS has a system to view payments, and it's good practice to confirm all payments within a short time frame, so that any rare lost payment issue can be disputed.
Be mindful of time zones if paying on the due date as pay1040.com uses CDT timestamp and payusatax.com uses EDT timestamp.
In general, you're allowed 2 payments per processor above per type of tax (annual and quarterlies being 2 different types, for example). They're not billed as cash advance fees. If 6 payments is not enough to pay your bill you can use a service such as plastiq (2.25% fee). If making multiple payments, it is advised you join here to track your payments link , you will be required to give your banking information and will receive a pin via snail mail
(Confirmed 4/2018 in post #429)
Fees are tax-deductible for C-Corps but not individuals (2018 tax reform eliminated "miscellaneous itemized deductions"). The majority of people will not be able to deduct that expense, check with your accountant.
When making multiple payments at or near your credit limit multiple times, allow yourself 3-5 days between payments for the charge to show up on your card and your bank payment to clear. If you wait until April 15th to make payments, you will only be able to clear the first payment.
Best Credit Cards to use/buy cheap points:
- Any credit card to hit minimum spend and achieve signup bonus or spend thresholds.
- BOA Premium Rewards 2.62% Cashback (Card holder needs to be a Preferred Rewards Platinum Honors member)
- Chase INK Premier 2.5% Cashback on purchases over $5k (Points are not transferable to airline or hotel programs)
- Capital One Venture X 2X Cap One Miles/Points (now transfer to most airline partners at 1:1)
- Amex Blue Business Plus 2X Membership Rewards (capped at $50,000 spend per calendar year)
- Chase United Business Club Card, 1.5X United Miles
- BOA Virgin Atlantic World Elite 1.5X Virgin Atlantic Points
- Chase Freedom Unlimited, 1.5X Ultimate Rewards, paired with a premium card (Sapphire Preferred, Sapphire Reserve, INK Preferred, INK Plus)
- Chase INK Unlimited, 1.5X Ultimate Rewards, paired with a premium card (Sapphire Preferred, Sapphire Reserve, INK Preferred, INK Plus)
- Amex Everyday Preferred 1.5X Membership Rewards, (need to make 30 transactions in a month for 50% bonus)
- Amex Business Platinum 1.5X Membership Rewards on purchases over $5K
Big Spend Bonuses:
- Amex Delta Reserve, spend $60k get 30k bonus miles and 30k MQM
- Citi Hilton HHonors Reserve, spend $10k get free weekend night, $40k, Platinum Status
- Chase Southwest, spend $135k get Companion Pass (WN points are redeemed at $.011, @ 1.87% fee, you're essentially buying the companion pass for $847)
- Chase Ritz Carlton Reserve, spend $10k get Gold Status spend $75k get Platinum Status
- Chase World of Hyatt, spend $15k get one free night
Cash Back cards:
Elan Fidelity 2%
Citi Double Cash 2%
Earn Status/Elite qualifying points:
- American, Delta, Alaska, Hyatt
Pre-Funding allowed:
Amex Charge Cards
Pre-Funding not-allowed:
Chase
Quarterly tax due dates: the 15th of April, June, September, January
Paying USA income, property or other taxes with a credit card
Jan 21, 2016, 8:17 pm
#301
Join Date: Jan 2011
Location: HKG • Ex SFO, NYC
Programs: UA 1K, AA EXP; Marriott Amb; Hyatt Globalist; Shangri-la Diamond; IHG SpireAmb; Hilton D; Accor G
Posts: 3,319
Any thoughts on whether you'd rather use an Amex Everyday Preferred card or the UA Club card for this? They seem to have lowered Amex fees to the same 1.87%.
Jan 28, 2016, 12:23 pm
#302
Moderator
Original Poster
Join Date: Jun 2003
Location: Miami, Mpls & London
Programs: AA & Marriott Perpetual Platinum; DL & HH Gold
Posts: 48,954
Virgin Atlantic MasterCard also earns 1.5 miles per dollar on general spending, but I wouldn't use any of those. I would use the tax payment(s) to achieve the new account bonus on cards I do not already have.
Mar 11, 2016, 9:27 am
#304
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Upper Sternistan
Posts: 10,037
Mar 11, 2016, 9:57 am
#306
Moderator: Budget Travel forum & Credit Card Programs, FlyerTalk Evangelist
Join Date: Aug 2002
Location: YYJ/YVR and back on Van Isle ....... for now
Programs: UA lifetime MM / *A Gold
Posts: 14,428
Mar 11, 2016, 10:06 am
#307
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Upper Sternistan
Posts: 10,037
Mar 11, 2016, 11:20 am
#309
Join Date: Mar 2013
Location: Jackson, WY
Posts: 543
Tell me if my analysis makes sense:
2 options, UA and MR.
UA Club Card
Amex Everyday Preferred
So, there's an easy way to earn 0.66-1% on tax payments.
Any other cards with good rates that may make this profitable? Any way to earn more than 1x UR?
2 options, UA and MR.
UA Club Card
- Earns 1.5x (miles per dollar).
- 1.87% fee to pay for taxes w/ Club card.
- 1.25cpm cost per mile (1.87 / 1.5)
- Fee is tax deductible, so is discounted 33% (conservative estimate)
- 0.83cpm after tax deduction
- Current TPG UA mile valuation: 1.5cpm.
- Profit per mile: 0.66cpm
Amex Everyday Preferred
- Earns 1.5x (points per dollar), when the 50% 30-transactions bonus is applied.
- 1.87% fee to pay for taxes w/ Club card.
- 1.25cpm cost per mile (1.87 / 1.5)
- Fee is tax deductible, so is discounted 33% (conservative estimate)
- 0.83cpm after tax deduction
- Current TPG MR point valuation: 1.9cpm.
- Profit per mile: 1cpm
So, there's an easy way to earn 0.66-1% on tax payments.
Any other cards with good rates that may make this profitable? Any way to earn more than 1x UR?
Your points earning is a little higher because of the fee - $1,000 taxes would be $1,018 charge x 1.5, which gives you an additional 27 points, marginal, I know.
I track all my redemption's meticulously. I don't give a rat's ... what TPG says the points are worth, it matters what YOU redeem them for. Same for first class. The ticket might be $2,000 but in reality you would only pay $800 for it. So when I book F using points I determine what I realistically would be willing to pay (substantially less) and put that value in my spreadsheet.
I've settled on the UA Club card for this use - I am generating mid six figure of points this way. UA is my go to airline because of my location and their route network. Amex, for me, doesn't have good transfer partners. I think you really need to settle on what you're going to use the points for. If you're not so settled then Amex is the way to go, you can at least transfer your points to a multitude of airlines.
Mar 11, 2016, 11:47 am
#310
Join Date: Jan 2011
Location: HKG • Ex SFO, NYC
Programs: UA 1K, AA EXP; Marriott Amb; Hyatt Globalist; Shangri-la Diamond; IHG SpireAmb; Hilton D; Accor G
Posts: 3,319
They're deductible for me if I hit $20k. I talked to my accountant about it and he said I'm not hitting the $20k.
Your points earning is a little higher because of the fee - $1,000 taxes would be $1,018 charge x 1.5, which gives you an additional 27 points, marginal, I know.
I track all my redemption's meticulously. I don't give a rat's ... what TPG says the points are worth, it matters what YOU redeem them for. Same for first class. The ticket might be $2,000 but in reality you would only pay $800 for it. So when I book F using points I determine what I realistically would be willing to pay (substantially less) and put that value in my spreadsheet.
I've settled on the UA Club card for this use - I am generating mid six figure of points this way. UA is my go to airline because of my location and their route network. Amex, for me, doesn't have good transfer partners. I think you really need to settle on what you're going to use the points for. If you're not so settled then Amex is the way to go, you can at least transfer your points to a multitude of airlines.
Your points earning is a little higher because of the fee - $1,000 taxes would be $1,018 charge x 1.5, which gives you an additional 27 points, marginal, I know.
I track all my redemption's meticulously. I don't give a rat's ... what TPG says the points are worth, it matters what YOU redeem them for. Same for first class. The ticket might be $2,000 but in reality you would only pay $800 for it. So when I book F using points I determine what I realistically would be willing to pay (substantially less) and put that value in my spreadsheet.
I've settled on the UA Club card for this use - I am generating mid six figure of points this way. UA is my go to airline because of my location and their route network. Amex, for me, doesn't have good transfer partners. I think you really need to settle on what you're going to use the points for. If you're not so settled then Amex is the way to go, you can at least transfer your points to a multitude of airlines.
Ended up paying on the EDP. I should be getting the deduction, but even if I don't, I'm mostly fine with buying at a rate of 1.25. Now I'm just excited for the Freedom Unlimited; because that's a currency I like a lot more!
Mar 18, 2016, 8:57 am
#311
Join Date: Mar 2013
Location: Jackson, WY
Posts: 543
So I decided to create a wiki post for this thread as I am getting to be a semi-pro at this. Half way through writing it I found this post from Frequent Miler two days ago here that is very detailed. I'm not sure if we are allowed to post bloggers link in the wiki so I didn't. It does belong there.
I'm not a 100% on what I wrote about the tax deduction on the fee. It is based on a 15 minute conversation with my accountant & a blend of the FM post. Certainly someone on this board can re-write it better than I did.
Also if someone is using debit cards please update. I know the Suntrust card no longer works. I believe there is a Alaska debit card that might work?
Same with MS, I don't do it, but that certainly would make this a cheaper option. Anyone good at it please add to wiki!
I'm not a 100% on what I wrote about the tax deduction on the fee. It is based on a 15 minute conversation with my accountant & a blend of the FM post. Certainly someone on this board can re-write it better than I did.
Also if someone is using debit cards please update. I know the Suntrust card no longer works. I believe there is a Alaska debit card that might work?
Same with MS, I don't do it, but that certainly would make this a cheaper option. Anyone good at it please add to wiki!
Last edited by Mbcijim10; Mar 18, 2016 at 9:16 am
Mar 18, 2016, 4:04 pm
#312
Moderator
Original Poster
Join Date: Jun 2003
Location: Miami, Mpls & London
Programs: AA & Marriott Perpetual Platinum; DL & HH Gold
Posts: 48,954
Moderator observation
Thank you for your work on the Wikipost.
You may post a link to someone else's blog in a Wikipost, the same as in any other post, subject to these rules. The important part is:
This means you need to include a high level summary of the information on the other site to help the reader determine whether to click the link.
FlyerTalk is here for the purpose of sharing meaningful information. Don't simply post a link by itself to another source, such as an article or blog. Posts containing such links should contain enough information so as to be contributive to FlyerTalk itself.
Mar 24, 2016, 3:04 pm
#313
Join Date: Jan 2016
Programs: Ink/Sapphire/Freedom/SPG
Posts: 338
Has anyone tried MO to pay IRS?
It has something on the website
https://www.irs.gov/Individuals/Pay-...or-Money-Order
It has something on the website
https://www.irs.gov/Individuals/Pay-...or-Money-Order
Mar 24, 2016, 3:52 pm
#314
Moderator: Budget Travel forum & Credit Card Programs, FlyerTalk Evangelist
Join Date: Aug 2002
Location: YYJ/YVR and back on Van Isle ....... for now
Programs: UA lifetime MM / *A Gold
Posts: 14,428
Mar 24, 2016, 7:20 pm
#315
Join Date: Jan 2016
Programs: Ink/Sapphire/Freedom/SPG
Posts: 338