byb310

1.87% fee is the cheapest I saw to use a credit card for your tax bill. Would you pay the fee to get the miles? Example: get 10,000 miles for a $187 fee? What is the best way to determine this?

bj2757

I used a credit card to pay our taxes two of the last three years - but only because I was using it to meet the minimum spend requirement for the card to get the 50,000 mile bonuses on new cards and the fee was only about $70. To me that was worth the fee I paid - not sure I would pay $187 to get 10,000 miles.

btk2333

Depends on the card- I intend to use my taxes this year to hit the $20,000 spending bonus on my own and my wife's British Airways Visa. That's approximately $748 for 240,000 Avios- that's worth it for me

I would maybe consider paying the fee for Starwood Points as they transfer 1:1.25 to many programs

Additionally the new Freedom unlimited makes the issue close- 1.5 UR points for 1.87 cents is very close to good value

There are not many I would pay the fee for a 1:1 earning ratio (ie. your example of paying $187 for 10,000 miles) since you're essentially buying miles for 1.87 cents per mile. Unless you have a specific redemption in mind you're probably better off with cash.

You could also put the taxes on a 2% cash back card and earn .13% paying your taxes . Not glamorous but its a guaranteed profit as opposed to miles.

CPRich

I've never seen it that low - usually 2.9%. If I had seen it, I may have used my 2% cash back card.

I don't value any miles at 1.87 cents. TPG doesn't either, with the exception of Alaska

satman40

SMGC cost $7.00 per $1,000.00 or $70.00 for 10,000. SPG Points, or convert the to AA 12,500.

Why pay $187.00 for 10,000 miles....

Many better deals out there...

sdsearch

This is the 1.87% service I used:

https://www.pay1040.com/

It was the lowest-priced of 3 I got after using Express1040.com to file my taxes. Two of them were under 2%, the third was somewhat above it.

I used my Amex Premier Rewards Gold where I'm working on $1000 spend to get 50000 MR points. My $200ish in federal taxes (I'm getting more than that as a state refund) thus earned me about 10000 MR points, while costing under $4 in fees. I don't consider paying $4ish for 10000 miles to be such a bad value. Extrapolate: That's $10ish for 25000 miles (a domestic saver round trip), or $40ish for 100000 miles (a business class saver round trip to Europe or Japan on some airlines still). How can $40ish not be a good value for 100000 miles?

I only have to pay taxes after filing every other year or so on average (the other years I get refunds on both federal and state), but I can't remember the last time I didn't have a signup bonus going when I did have to pay.

As to value of miles in cents, it depends on what you redeem for. The value tends to be lower on domestic coach flights, but those I pay for in cash most of the time. The value tends to be much higher for longhaul international.

CPRich

As I noted, 1.87 is lower than I've seen in the past, and marginally worth it had I seen it. Though frankly that website tells me to run away (despite being listed with the IRS).

One-time bonus opportunities are just that - one time. Assigning a value to that can't be generalized. Otherwise, I could say my SPG points are worth about 10 cents based on the Super Bowl experience I redeemed. Once.

And the same old discussion of "value" of extremely high fare international flights that I, and most folks, would never actually pay cash for. If you want to "value" your points based on $20K F flights, then you should be maxing out all the purchase options that all of the programs provide. Whatever floats your boat.

BigLar

I haven't had to pay in years. However, there are those signup bonuses where you need a certain spend. So ...

I typically get an extension to pay so I have about 9 months of the year before I have to pull the trigger. When I get a new card with a juicy bonus, I prepay my taxes (and pay the fee) the same day I file, and claim the money back as a refund.

Net net, it only costs me the cc fee, and I don't feel it's worth it for just a few thousand miles. 50,000 miles, however, is certainly worth it.

mia

See also long running discussion in Credit Card Programs forum:

http://www.flyertalk.com/forum/credi...edit-card.html

OTPorBust

pi1ot

Paid mine with my AMEX Starwood. Worth it to me. I will be redeeming the points for a hotel room at a value of almost double the 1.87%.

sdsearch

Please read what you quoted carefully. The person you quoted wasn't saying they valued Alaska higher, they were saying The Points Guy (as linked) did. The person you quoted said they didn't value any airline miles higher than 1.87, then gave The Points Guy link to show that TPG felt about the same (with TPG having the Alaska exception).

So your question is for The Points Guy, not for the person you were replying to.

Since you're based in PDX, aren't you familiar with the Alaska program? It has slightly lower miles requirements for many routes than AA/UA/DL. However, it has a redemption requirement of only one partner per redemption, which makes it harder to use for people not in a city served by Alaska.

macman806

I paid my taxes using my Citi AA via Plastiq, didn't count towards the spend.

jellson

was it considered a cash advance instead of purchase?

Stgermainparis

I'm going to owe between $1k-3k and would like to go a head and pay $1k now and the rest later when I actually file. I've only ever paid the total due on the same day that I filed via TurboTax. Any issue with this? Will it confuse the irs to get a payment unattached to a return?