chaser123

I do it every Jan 15. No issues other than I am super eager to file. I holdback 1,000 incase someone amens a 1099. I have doen over 100k. It took a few years to grow to that number but I am nnow confortable doing any amount the card will let me.

timaelabu

Hi
I just got 2 Cards
1. Chase Sapphire Reserve (3x trav/dine, 1x others)........................................... .$4000 in 90 days
2. Bank Of America Premium Rewards-Tier3 (3.5x trav/dine, 2.625x others).......$3000 in 90 Days

I have to pay 14k in taxes. Is the following math checks out ....?
CSR -- Pay $4000 = 4000 points
BAPR Pay $10000= 26250 points
Total Points = 30250 points
Dollar Equivalent =$302 (As per TPG 1 point =1 cent)
Fees to Pay x/CC =14k x 1.87 = $262
Am I making a profit of $40 by paying with a credit card ? ( in the form of points)

cruisr

timaelabu

Thanks for your response.
That i s correct i am getting 50000 points on both cards. I am totally new to this game.

Does that mean my math is correct and i should go ahead and make the Tax payment with the $262 fee ?

radonc1

So you could also do the following (in the future after you have broken in the cards). The following also assumes you have a Simon mall to buy SMGCs and a WM to convert to MOs.

Buy 28 SMGCs. (Cost: $3.95/$500 card x 28 cards = $110.60)
Convert to $14K by buying 14 $1000 MG MOs. (Cost: 14 MOs x $0.88/MO = $12.32
Deposit said MOs into independent checking account set up to pay bills you are unable to foist off onto a CC. If your taxing authority takes MOs for payment, then skip the last step and simply sign over the MOs to the taxing authority.
Write check for $14,000 to pay taxes.
Total cost is $110.60 + $12.32 = $122.92
More work but you do save yourself $138.09.

You decide if it is worth the effort. While this will probably not be good for the immediate tax situation, you can always start to save for next year's bills.

TyPo311

I don't you think advising someone new to the game to spend 14,000 on VGCs is a good idea. Paying taxes at less than a 2% fee is a pretty good way to hit your minimum spend requirement without getting too deep into MS. If timaelabu wants to try going the VGC route it's advisable to start slow.

TyPo311

The 50,000 points is definitely worth the $262 fee.

timaelabu

So i am able to spend 4000 for CSR and 3000 BAPR cards in the next 90 days to get the 50k+50K signup
.i was contemplating if paying Taxes for additional 14k Point is worth it or just pay 14k with a check.

I just recently read up on the cards and points:approx $ ratios. I have still not had to excitement of using points for any purchases yet - haven't experienced the rush everyone talk about - I'm a total newbie.

Also- thanks to radonc1 to clearly explain how the MS works - mind blown.

I gave up after reading a few guides as i could not undersant a some of the lingo..I am now researching SMGC - google tellme i have 3 of these malls nearby.
haven't been to a mall in years and all i know is you can buy store GCs...not sure where i would find the SM service desk in a mall to get the GC. never ever done a MO...saw commented about splitting MOs - not sure what that issue is.....also i have been scared by the youtube vids about MS and locking up chk. account. so need to readup a lot before i jump into it.

RedSun

Some of the sites limit the number of CCs that you can use. I believe IRS is max 2 CCs for 1040 filing. So you can't spread it over 3 cards or more.
Yes, definitely decreasing withholding amount and paying more estimated tax can be the way to go if you are willing to manage it. It is perfectly legal.

timaelabu

awesome.
thank you

radonc1

How many caveats do I need to put into a post for it to be a sufficient warning (about not being appropriate for the immediate situation but something that might be considered in the future) ?

Such as:
in the future after you have broken in the cards
or:
While this will probably not be good for the immediate tax situation, you can always start to save for next year's bills.

rct12345

"I have to pay 14k in taxes"
Which means that you would have done this irrespective of hitting the MSR or not?
Also, you have plat honors with BofA giving 2.625% cash back on Premium rewards. For any amount of tax payment at 1.87% fee, you will come out ahead with this card.

If you want to dip your toes in MS water, then try MS'ing the CSR for 4k which is a decent'ish amount to do in 90 days and put the entire tax payment on your BofA Premium rewards card.

libralibra

Before paying 14k tax on your BoA CC, make sure you will actually get the 2.625%. I.e. make sure you are already in the highest tier of Premium Rewards, otw you will only be getting the regular 1.5%. (You can log into your account and just look at a recent charge in the Rewards tab.) It can take up to 3 months to qualify for this tier if you are a brand new bank account customer.

But yes, at 2.625% you are making about .75% when charging your taxes, so about $75 back for every 10k, making it better than writing a check.

1120

Has anyone here used the SPG Amex to pay taxes?

i owe about $20K and it seems like a pretty good deal to get Starpoints at 1.87%

Ultimately, these will be converted to MR points and used for travel packages.

RedSun

You can use any CC to pay tax. SPG, Chase FU and upgraded BA Premium cards are all good at flat reward rates. You do not want to start another fight on the merits of the SPG card. This was talked recently in another thread (closed now).