How to earn 5 points per dollar paying taxes


Thanks to Chase’s line of Ink charge and credit cards, it is fairly easy to earn 5X on virtually all credit card purchases.  If you’re not already familiar with these techniques, please read “One card to rule them all” and “Almost too good to be true” for background.  People frequently ask me, though, how they can earn 5X for common big expenses that aren’t usually paid by credit card: mortgages, student loans, taxes, etc.  Today we’ll take a look at taxes.

Last week I showed how to pay Federal taxes in $500 increments using Vanilla Visa prepaid cards (see “How to pay Federal taxes with a Vanilla Visa”).  If you use a Chase Ink card to buy $500 Vanilla Visa cards at Office Depot, you’ll earn 5 points per dollar for those purchases (since Ink cards give 5X for office supply purchases).  By using these cards to pay taxes, you effectively earn 5X for doing so.  Even after accounting for all of the associated fees (1.7% total), you will clear 3.3X if you value Ultimate Rewards points at only a penny each.

The problem with using Vanilla Visa cards to pay taxes is that there are strict limits to how many payments you can make.  payUSAtax (which offers the lowest fees) limits you to 2 estimated payments per quarter, and two end of year tax payments.  Overall, you can cash in, at most, $5000 per year with this technique.  Or so I thought…

More than $5K

In response to my post “How to pay Federal taxes with a Vanilla Visa,” many readers asked how they could make larger payments.  Could they combine multiple Vanilla Visa cards into one payment?  Are there other services besides payUSAtax that allow more payments?  Are there other debit cards with higher limits that can earn 5X?


The IRS has a nice web page that lists the options for paying taxes with credit and debit cards (see “”).  On that page, they present this chart showing three service providers who accept cards for payment:


I contacted each of the above service providers to find out if there were ways around the 2 payment limits.  Each confirmed that the limits were in place, and each agreed that it should be possible to do more by using multiple service providers.  That is, each quarter you should be able to make 2 payments via WorldPay, two payments via Official Payments Corp, and two payments via Link2Gov.  By spreading payments in this way, you could theoretically use $500 Visa cards to pay as much as $15K per year towards taxes.

I was concerned that dodging the 2 payment per quarter limit would run afoul of IRS rules, so I called the IRS.  The advisor I spoke with didn’t know why the 2 payment limit exists, nor did he think anyone would get in trouble by doing more than 2 (by using multiple service providers).  He had certainly never heard of anyone getting in trouble for doing so.  It wasn’t exactly a ringing endorsement for this approach, but it does help give it a little cover.

Another option was presented to me by Official Payment Corporation.  They told me the following in writing (email writing, that is):

If you need to make more than two payments for each quarter, please contact Official Payments customer service at (800) 487-4567 and an associate will be able to assist with processing additional payments.

I called their phone number to confirm this.  Could I really make more than two 1040-ES payments per quarter by doing so over the phone?  “Yes, no problem,” I was told.  Interesting.  Official Payment Corporation charges 46 cents more than payUSAtax per debit transaction ($3.95 vs. $3.49), but offers a way to make as many payments as you’d like.  When you account for both this fee ($3.95) and the fee for buying the Vanilla Visa card in the first place ($4.95), the total fees come to 1.8%.  In my mind, this is a readily acceptable cost if you earn 5X when buying Visa cards.

Other 5X Options

In addition to Vanilla Visa cards, Office Depot sells Vanilla Reload cards.  The trick is to buy $500 reload cards with your Chase Ink card in order to get 5X points.  Then, use the reload cards to load the money onto a prepaid card.  There are several prepaid cards that can be reloaded with Vanilla Reload cards: American Express Prepaid, NetSpend, Mio, and Momentum (and eventually MyVanilla which is always “coming soon”).  American Express claims that their card cannot be used as a debit card, but all of the other listed cards are debit cards and so would have much lower fees for paying taxes.  I haven’t tried using any of these cards in this way, but I have no doubt it’s possible.  The primary advantage over using $500 Vanilla Visa cards is that it is possible to make fewer, larger payments.  Fewer payments would mean significantly lower debit convenience fees.

Unfortunately, this approach may not be as perfect as it sounds.  NetSpend has been known to shut down the accounts of everyone who pumps large amounts of money through the card.  I wrote about my own experience with getting shut down in the post “We’re sorry, there is a problem with your account.”  I think that one could use the NetSpend card to make one or two tax payments before getting shut down, but I doubt anyone would get further than that.  Only time will tell whether the companies behind Mio, Momentum, or MyVanilla are more understanding.

Other options for earning points and miles

The best and easiest option I know of for earning miles while paying taxes is to use the SunTrust Delta debit card.  See Million Mile Secret’s post “$3.49 Debit Card Fee = LOTS of Delta Miles For Tax Payments!” for details.  This won’t get you 5X points, but it’s a lot easier and cheaper than any approaches I listed above.

The next best option is to use credit cards in situations where the benefits earned outweigh the credit card processing fees.  There are many situations in which this may be the case so I’ll follow up with one or more in-depth posts about this in the future.

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[…] Payment Frequency Limits: The IRS maintains another page showing the maximum number of payments that can be made by credit or debit card.  In general, annual payments are limited to two per year and quarterly payments are limited to two per quarter.  A couple of years ago I researched ways to get around these limits.  I found the following (please see full details here): […]


Lisa: I’m sorry, it was so long ago when I called that I don’t remember if I had trouble reaching a person or how I did it.


Help! How were you able to talk to a live human at official payments? I’ve tried everything and can not get to an actual person to make a payment or even ask questions.

Thanks so much!

[…] How to earn 5 points per dollar paying taxes […]


Net Spend Warning – Both of our cards were shut down with high balances on them. Took forever to get the refunds, which I admit, I was sweating out. Based on telephone contacts with their reps and their BBB and google reviews, I did not have confidence in the entire operation. I read about others getting shut down, but optimistically, didn’t think it would happen to us.

Official Payments – GREAT TIP ! After first spreading out my payments amongst the 4 different service providers, I called Official Payments and got many ONE VANILLA Visas processed for $496.05 each. A bit of a hassle to register them all with a zip code, but worth it. Cost is $4.95+$3.95 per $500 card, which is 1/3 of a percent per mile using Ink for 2,500 UR per card.


Thank you!


Mtravel: If the sapphire is the only recent card you’ve signed up for then you should be OK, but if you’ve signed up for several other cards recently I’d recommend waiting 91+ days since the last application. If you do sign up for the card, you probably won’t get approved instantly. Your best bet is to call up the business reconsideration line to get approved over the phone. Details are in this post:


Yesterday I purchased $2000 worth of vanilla reload cards at 3.95 each for 4 cards. Then I purchased a net spend card for 3.95. I loaded the funds onto the net spend card and paid taxes online for a debt card transaction fee of $3.95.

The transaction earned me 40k Bonus points plus 2000 points from the purchase of the vanilla reload.

It was pretty easy.

I Want to apply for the chase ink plus but since I just got my sapphire card last week I am afraid I may get rejected. Any thoughts?


Thank you! It worked!


I can’t figure out how to reload the netspend account using the vanilla card. There does not seem to be an option to do that on the site. Please help?


Mtravel: You need to go to to load the NetSpend card (or the Amex Prepaid, or the Mio, ec.) with a Vanilla Reload card. You can’t reload with a Vanilla Visa card.


Frequent miler,

The call center was closed at the time. Calling was very easy and painless, took about 5 minutes for 6 cards. Thanks for the tip, love the blog.



Brian: I’m glad it worked!


Nancy: I had a similar experience early in the year trying to pay for a Daily Getaway. I contacted them about it, and the following week I found that they had added more allowed expiration dates. So, it might pay to let payUSAtax know about this…


Check your gift card expiration date! I was on (same company as and was all set to use a new Visa card to pay $500 estimated taxes. But expiration date entry only goes to 2020 and I had a 2021 date!


Brian: that’s correct. What matters is the service provider not the web site. Without a phone call you can do $3k each quarter for estimated payments and then another $3k for an end of year payment. Total = $15k per year. Why not just call, though?


kv: property taxes are handled differently in different locations. When you get your tax bill see if credit and debit payments are allowed.

rich: yes, that’s true. When you’re earning 5x or a big spend bonus, spending a few percent on fees can be well worth it.


I paid the max at each site, but unfortunatley you can’t use both and to make four payments. Same goes for Pay and So the max without a phone call you can do is 3k. Did I do something wrong?

rich (arizona)

Chargesmart is high but if I pay ~2.4% in fees to obtain 25,000 points I would not have obtained otherwise it would be worth it. In my case I would end up getting Chase points at 1/2 per point.

Usually I wouldn’t do a $10K spend in 3 months but with a mortgage it can be done with minimum issues.

Next year I might have to consider using it for the BA companion ticket.

There is one contractor that does some home repairs for me and I told him recently that if he doesn’t start taking CCs for payment I would go elsewhere for large repairs. Now he is investigating the best way to do so.



how about property tax?? this is coming up Nov.

frequent churner

Don’t bother with Paypal, it’s the same thing as Netspend. All the others are run by Incomm, so getting several of them is pointless, unless one has better features than Mio.


Thanks FM. I noticed the Paypal card at the store today. I might buy one to test it out but if it’s powered by Netspend, I’m not optimistic.


Yes, it’s very easy to make ACH payments, but as Piecerate says it’s dangerous in that you’re very likely to get shut down. Even the money order approach has gotten people shut down with NetSpend. I think we need to find a prepaid card that can be loaded via Vanilla reloads AND is less prickly…


My lender, Provident, allows an ach draw off of any source that has an account number and a routing number. So I could pull the payment out of my Mio account but I am super reluctant to do so. Mio is my bread and butter and I don’t want them to pull a netspend on me and end the fun. But oh, getting points from the mortgage payment without getting fleeced by ChargeSmart, how fabulous would that be? I can’t wait to see what FM comes up with.

frequent churner

@FM — there’s one easy way, it’s to debit the mortgage payment directly out of the reloadable card’s account. Most cards let you do it and provide a routing+account numbers. I did it with NS quite successfully, until their “compliance department” said how dare I use them as a replacement for a bank account. Never mind that they advertise themselves this way to begin with.
Second way is Chargesmart or if the lender accepts debit payments, but Chargesmart fees are out of control and most lenders want check or bank debit.
Finally, most prepaid cards have a bill-pay feature which sends a money order to the billing entity, like the lender, and this might be a more sustainable way to do it longterm. The fee is usually a few dollars or even free.


You can also call chase or amex and the reps will usually do the math on how much you’ve spent on a particular card and tell u how long you have to reach the min spend threshold.


Thanks Grant and FrequentMiler – just applied for the Chase Ink Plus using FM’s link (hope to be approved tomorrow).


rich (arizona): BA $30K spend is calendar year. If you send a secure message to Chase on the web site, they’ll get back to you in a day or two telling you how far you are / how much to go.

rich (arizona)

Is there any way to get 5X or whatever on mortgage payments?

I know there are places online I can use to pay via a credit card and pay a fee. The fee neutralizes the miles somewhat. I will pay the fee in order to meet a threshold and get bonus miles or possibly the companion ticket on BA.

If I could get 2x+ on my mortgage then it would definitely offset any cc fees.

One other question. Do you happen to know if the spend limits such as the $30K on the BA card, etc. are calender spends (i.e., between January 1 and December 31st)? I’m guessing they are.



rich: Mortgage payments are my next investigation!


I doubt that is a complete list of cards that work. for example, I don’t see the Amex prepaid card on that link.


bluto: very good point. I have some more research to do!


bluto: I called the Vanilla Reload Network and was told that the full list of reloadable cards is: Mio, Momentum, Netspend, Amex, and Paypal Powered by Netspend. And, of course, OneVanilla is coming soon 🙂


Hi! Thank you for all the useful information! Excuse my ignorance, but is there a difference between Vanilla reload cards and Vanilla visa debit cards? I went to a Office Depot last week and they were all out! Your post made references to both, so wanted to check if there was more than one. Like Kathy, I have to make a big estimated payment, and want to try to do some on check and some on debit cards.


WC: yes, there is a difference between the two. Reload cards can only be used to load money to reloadable prepaid cards. Vanilla Visa cards are stand-alone prepaid visa cards (not reloadable after initial purchase)


Good point again FM. It seems to me that the 4th quarter due date of Jan 15 is the outside deadline to pay by. That’s the one that’s going on my calendar anyway.


@sam_goh December 31, 2012 is not the deadline for payments for the 2012 tax year.

I suppose that’s true. But your tax liability accrues as of Dec 31 and if you under-withhold as of that date you may be subject to penalties. I think sam_goh’s Dec 31 deadline is a much safer one if you’re going to walk this line.

I’ve been nosing around to see if there is any reason you can’t make multiple e-payments and other than the language itself saying two is that max I and can’t find any. I know it’s permissible to pay estimated taxes more often than quarterly if you send a check, so it’s hard to imagine getting into hot water with multiple e-payments. I think I’ll give it a try. It’s just that it has been my experience that the IRS is generally driven more by rules than by what makes sense. Nice find Frequent Miler. Great thinking outside the box.


@sam_goh December 31, 2012 is not the deadline for payments for the 2012 tax year.


We’d need to ponder strategies for overpaying taxes and receiving a refund in terms of optimizing the float. Always good when you can manufacture spend.

1) Would need to pay as close to Dec 31 as possible to minimize the time you float the overpayments
2) Need to know how many days it takes to clear and get accepted by Dec 31. Would suck to miss the credit for the year and it land in Jan.


, I have a Netspend card but am reluctant to use it for large payments because, like you, I am worried about getting shut down. Instead of using a Netspend card, would it be possible to load onto one of these other prepaid visa cards ( I have been meaning to experiment with them but it looked like a bigger task more suitable for a professional 😉


bluto: The Vanilla Reload site lists the cards that can be reloaded (see My guess is that any card not in that list can’t be reloaded with a Vanilla Reload card (but please prove me wrong!).

Sam_goh: As bluto said, taxes aren’t due Dec 31. 4th quarter 2012 payments are due Jan 15. End of year payments are due April 17. I believe that you can make payments on the due date without any issue so as to minimize the amount of time the IRS keeps your money.


@Amnesiac, I would assume the plus is easier to get because it is a credit card instead of a charge card, but other than that, they are the same. I have the ink bold which had a $5k sign up min, I would wait for a lower sign up min for the plus.


I am looking to get one of the “Ink” cards (dont have any at present). For someone that is looking to get just one card, would you recommend the Bold or the Plus (I realize one is a charge and one is a credit card, and wanted to know which might be more beneficial).



All of this is very interesting, yet confusing. I really wish the stores sold one big prepaid debit card. If I understand correctly, I will need 18 $500 reload cards. Then I will need to load those to a prepaid card such as NetSpend. I hate to miss out on any miles and points, but wonder if I should just write the check (that would stink). Have read all of your posts on Chase closing down cards, etc. and I do not want to have my account closed. My ink bold is the card that I would use to get the reload cards. Thank you so much for all your research.


Kathy: Why don’t you split this up and do some via check and some via prepaid cards? That way you can get a sense of how much trouble it is to get 5X without going in too big this time around.

Amnesiac: As Grant said, the only difference between the Bold and the Plus is that the Bold is a charge card whereas the Plus is a credit card. To me, they are equal. With the Bold you have to pay off your balance in full each month. With the Plus you don’t have to (but you should!). The Plus does offer 0% interest for the first 6 months so if you’re very, very careful you could run a balance the first 6 months without paying any fees, but make sure to pay it all off before the 6 months are up!

Dave Op

I don’t have the Chase Ink (whatever version) cards, only the Sapphire Preferred. Is there anyone to get 5% on everyday spending without the Chase Ink cards?


Dave Op: Not easily. The best opportunities for the Sapphire Preferred are through bonus offers in the Ultimate Rewards Mall. This month, for example, you can get 10 bonus points per dollar at Bloomingdale’s and Kohls. For general everyday shopping though, it’s tougher. You could buy Sears gift cards through the UR mall (currently 4X for Sapphire, but 10X for Freedom) to get points then use the gift card at Kmart to buy a different gift card that you really want.