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Paying USA income, property or other taxes with a credit card

Old Mar 18, 2016, 8:54 am
FlyerTalk Forums Expert How-Tos and Guides
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.
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


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Paying USA income, property or other taxes with a credit card

Old Apr 12, 2024, 9:56 am
  #916  
 
Join Date: Apr 2004
Location: NYC
Programs: UA, AA Gold, Delta, HHonors Diamond, Marriott, Starwood
Posts: 214
I know that the limit is 2x per quarter per processor for estimated tax payments. Does anyone know if the quarters are just the regular fiscal quarters?

For example

Q1: January 1 to March 31
Q2: April 1 to June 30
Q3: July 1 to September 30
Q4: October 1 to December 31

I just made my estimated tax payments for today using payUSAtax (split among 2 credit cards), so would the next eligible date that I could use the same payment processor be July 1?
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Old Apr 12, 2024, 10:01 am
  #917  
 
Join Date: May 2022
Posts: 2,533
Overpaid my taxes by 18k. I made the payment on 3/29, the same day I filed my return. Received my refund this morning.
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Old Apr 12, 2024, 5:26 pm
  #918  
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Location: Saipan, MP 96950 USA (Commonwealth of the Northern Mariana Islands = the CNMI)
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Originally Posted by sadeghi (Post # 916)
I know that the limit is 2x per quarter per processor for estimated tax payments. Does anyone know if the quarters are just the regular fiscal quarters?

For example

Q1: January 1 to March 31
Q2: April 1 to June 30
Q3: July 1 to September 30
Q4: October 1 to December 31

I just made my estimated tax payments for today using payUSAtax (split among 2 credit cards), so would the next eligible date that I could use the same payment processor be July 1?
No. The quarters are not normal calendar quarters, and the payment due dates most certainly are not. Consult the relevant IRS publication for those dates:

Jan. 1 – Mar. 31, 2024. . April 15, 2024.
April 1 – May 31, 2024. . June 17, 2024.
June 1 – Aug. 31, 2024. . Sept. 16, 2024.
Sept. 1 – Dec. 31, 2024. . Jan. 15, 2025.
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Last edited by SPN Lifer; Apr 12, 2024 at 5:45 pm
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Old Apr 13, 2024, 12:11 pm
  #919  
 
Join Date: Feb 2013
Programs: Hyatt Globalist, MLife Gold, Marriott Gold, HHonors Gold, Caesars Diamond, Amex Plat
Posts: 6,093
Is it still the case that I can pay annual taxes due (not estimated) with more than one payment? Like pay half with a cc and then the other half with another cc with same processor? Haven’t used a cc for taxes so just making sure.
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Old Apr 13, 2024, 6:42 pm
  #920  
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Join Date: Mar 2002
Location: Saipan, MP 96950 USA (Commonwealth of the Northern Mariana Islands = the CNMI)
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Posts: 15,592
Originally Posted by Stgermainparis (Post # 919)
Is it still the case that I can pay annual taxes due (not estimated) with more than one payment? Like pay half with a cc and then the other half with another cc with same processor? Haven’t used a cc for taxes so just making sure.
Yes, though most processors allow a maximum of two payments per taxpayer.

If a joint return, the other spouse could probably make two more payments, or there are always other processors.
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Old Apr 14, 2024, 10:52 pm
  #921  
 
Join Date: Feb 2013
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Posts: 6,093
Originally Posted by SPN Lifer
Yes, though most processors allow a maximum of two payments per taxpayer.

If a joint return, the other spouse could probably make two more payments, or there are always other processors.
Excellent. Thanks. After some digging on irs webpage saw that taxes due have a limit of two payments. So two it is! That’s all I needed in any case.
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Old Apr 15, 2024, 5:14 am
  #922  
 
Join Date: Aug 2012
Location: BOS/MHT/PVD/BDL
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Posts: 882
Taking advantage of full billing cycle and grace period is nothing new, but I've been deploying it for the last year or so for tax payments. To squeeze a little more juice, I had my billing cycle end on the 14th. I pay our final estimated payments on the 15th, which gives us nearly 2 months interest free money. Put that into a 5% high yield money market until payment due date. The credit utilization does ding your credit score a little, but I'm fine with that. of course, YMMV.
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Old Apr 15, 2024, 9:24 am
  #923  
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If I use Paypal to pay my income taxes today does the charge earn Paypal Rewards?
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Old Apr 29, 2024, 2:51 pm
  #924  
 
Join Date: Jul 2010
Location: Adelphi, MD
Programs: Korean Air Skypass, ANA Skyweb, Amex Premier Rewards, Chase Sapphire Preferred
Posts: 755
Well, I payed off my Fed and State taxes of 30,000$ using my Chase Sapphire Preferred. Cost me over 700$ in fees but I will Receive points worth 375$ if I use the Travel Portal + I get 2 months to pay.

Last edited by smith80678; Apr 29, 2024 at 3:08 pm
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Old Apr 29, 2024, 4:21 pm
  #925  
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Originally Posted by smith80678
Well, I payed off my Fed and State taxes of 30,000$ using my Chase Sapphire Preferred. Cost me over 700$ in fees but I will Receive points worth 375$ if I use the Travel Portal + I get 2 months to pay.
Not sure I see the point there. Two months float is, generously, 1% in interest, right? So $300.

Plus the $375 in points.

So $675. For a cost of $700.

Plus you're locked into a non-cash currency.
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Old Apr 29, 2024, 10:54 pm
  #926  
 
Join Date: Jul 2010
Location: Adelphi, MD
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Posts: 755
Originally Posted by josephstern
Not sure I see the point there. Two months float is, generously, 1% in interest, right? So $300.

Plus the $375 in points.

So $675. For a cost of $700.

Plus you're locked into a non-cash currency.
Yeah, I lost money for sure but got a little back
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Old May 2, 2024, 9:15 am
  #927  
 
Join Date: May 2022
Posts: 2,533
Originally Posted by smith80678
Well, I payed off my Fed and State taxes of 30,000$ using my Chase Sapphire Preferred. Cost me over 700$ in fees but I will Receive points worth 375$ if I use the Travel Portal + I get 2 months to pay.
Not sure I agree with your math....30,000 * 1.82% = $546

Did you not have another card you could use?

Personally for that amount I look at it as you could have gotten 2 free Hilton nights with Business/Surpass cards, plus between 90,000 and 150,000 points depending on the card. Easily could have been a money maker. 2 different Hyatt cards could have also gotten you 2 free nights and 30,000 points.

An Unlimited card would have at least gotten you 1.5x instead of 1x. A 2% cash back card like Fidelity would have given you more cash back than the charge itself since 2% > 1.82%

At the very least could have been a big help at getting you a SUB
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Old May 2, 2024, 10:19 am
  #928  
 
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Originally Posted by Schnit
… 1.82% …
Juice* for NYS estimated tax payments is 2.4%, vig* for my municipality property tax payments is 2.4%.

(* “juice”, “vig”, also known as vigorish, is the amount charged for taking a bet, the % amount will vary, in part based on the odds.)
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Old May 14, 2024, 3:48 pm
  #929  
nsx
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Has anyone reported problems paying taxes with an Amex Business Blue card?
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Old May 14, 2024, 4:11 pm
  #930  
mia
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Originally Posted by nsx
Has anyone reported problems paying taxes with an Amex Business Blue card?
The only problem is that I used Blue Business Plus to make Federal payments on 13 April, and now American Express wants to be paid .
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