You might not like paying taxes, but when you pay taxes via credit card can be quite rewarding. The key is to earn credit card rewards that more than offset tax payment fees. For example, if you’ve signed up recently for a card that requires large spend to get a big welcome bonus, paying taxes via credit card can be the solution.
Here’s everything you need to know about paying taxes with credit cards…

Table of Contents
Important due dates
2021 Tax Year Due Dates
- April 18 2022: End of year taxes due. Taxpayers in Maine or Massachusetts have until April 19, 2022, to file their returns due to the Patriots’ Day holiday in those states.
2022 Tax Year Due Dates
- April 18, 2022: 1st quarter 2022 estimated taxes due.
(Payable online from 03/01/22 – 05/15/22) - June 15, 2022: 2nd quarter 2022 estimated taxes due.
(Payable online from 05/15/22 – 07/15/22) - September 15, 2022: 3rd quarter 2022 estimated taxes due.
(Payable online from 07/15/22 – 10/15/22) - January 16, 2023: 4th quarter 2022 estimated taxes due.
(Payable online from 10/15/22 – ?) - April 17, 2023: End of year taxes due.
Deals
Current Deals
- Nearside Debit: 2.2% back on debit spend through 2023. Note that the 2.2% just launched this year. So, while taxes aren’t excluded in cashback, there’s been no DP’s yet.
- Peruse best credit card welcome offers here.
- Simon Mall has been offering near-weekly discounts on fees for bulk orders of $1K gift cards. You can see the current (or most recent) deal here.
Future Deals
- Discover It will offer 5% back on PayPal (and restaurants) on up to $1,500 spend, July – September 2022. Both ACI Payments and PayUSATax allow payments via PayPal.
Pay taxes via credit card: Key Info
Here is key information you’ll need to know about paying taxes with credit or debit cards:
Credit card fee 1.87% to 1.98%
The IRS maintains a list of companies that accept credit and debit cards towards tax payments. You can find the current information by clicking here. Currently there are three separate payment processing companies on the list. At the time of this writing, debit card fees range from $2.20 to $2.55 per transaction and credit card fees range from 1.87% to 1.98%. Alternatively, you can pay taxes via the Plastiq Bill Pay service, but that will cost you more: 2.85%.
Additional Info Direct from the IRS
The IRS page that lists options for paying by credit or debit card also lists the following “Additional Information”:
- No part of the card service fee goes to IRS.
- You don’t need to send in a voucher if you pay by card.
- Card processing fees are tax deductible for business taxes.
- You must contact the card processor to cancel a card payment.
- IRS will refund any overpayment unless you owe a debt on your account.
[Editor’s caution: In recent years the IRS has been very slow to do so] - Your card statement will list your payment as “United States Treasury Tax Payment” and your fee as “Tax Payment Convenience Fee” or something similar.
- Federal tax lien releases can take up to 30 days after we receive full payment; liens may remain for other individuals who haven’t fully paid their portion.
- When you pay while filing your taxes through online software, different card fees apply.
Two payment limit per processor
The IRS maintains a table of frequency limits for paying taxes via credit or debit card (found here). In general, they say you can make up to two payments per tax period per type of tax payment. For example, you can make 2 payments every quarter to your quarterly estimated taxes, and you can make 2 payments every year to your annual taxes. Important: In my experience, these limits are enforced per payment processing company. That means that you can really make up to 6 payments per tax period per type of tax payment (or more if you make Plastiq bill payments as well). An IRS advisor I spoke with several years ago did not think that there would be any problem with making more than 2 payments by using different processors. Since then, I have made more than 2 payments per tax period many times and never had any issues. That is, of course, just my own personal experience. I can’t guarantee that your outcome would be the same.
Twice as many potential payments when filing jointly
If you file jointly with a partner, you can make payments in each person’s name, separately. These payments will still apply to the one overall tax return, but not always automatically. According to reader reports, in some cases the IRS matches these payments to the combined return automatically. In other cases, people have reported the need to call the IRS to ask them to combine the payments. I recommend calling shortly after filing your annual taxes to ensure that the IRS has correctly applied both sets of payments to the same return.
Obviously if you are filing separately, you can each make your own payments without any issues.
No cash advance fees
I’m often asked whether credit card companies charge cash advance fees when paying taxes by credit card. The answer is no. All three official IRS payment processors agree (via their FAQ pages) that the payment is treated as a purchase not a cash advance. You can find FAQ info here, here, and here.
Unlimited payments via Plastiq
If you’re willing to incur higher fees, you can make an unlimited number of tax payments via the Plastiq bill pay service. Plastiq usually charges 2.85% to pay bills (including taxes) via credit card, but they occasionally offer lower fees via short term promotions. For details, please see: Plastiq Bill Payment Service.
To pay taxes via Plastiq, use Plastiq’s tax payment screen: plastiq.com/us-taxes.
Are tax payment fees deductible?
Fees are no longer deductible for personal taxes: Tax preparation fees used to be deductible when itemizing deductions for personal tax returns, but that is no longer the case.
Card processing fees are tax deductible for business taxes: This can substantially reduce your net cost of using payment services.
Tax payment history (how to see your info online)
Once you’ve made payments through online processors, Plastiq, or other means, you may want to see proof that the IRS received the amount you sent. You can view past payments by signing up here: irs.gov/payments/view-your-tax-account.
Reporting estimated payments
Estimated payments should be reported when filing your annual taxes. In my experience, if you make a mistake and forget to report some of these payments, the IRS will eventually catch the error and refund the difference.
How to pay end of year taxes
Tell your tax preparer or tax software that you’ll pay via check. Then, browse to the appropriate tax payment site (e.g. Pay1040.com, OfficialPayments.com, PayUSAtax.com, or Plastiq.com/us-taxes) to pay your taxes. There is no need to mail in the 1040V payment voucher.
What happens if you over-pay your taxes?
Overpayments will be refunded: The IRS will refund any overpayment unless you owe a debt on your account. Update/Caution: In recent years the IRS has been very slow to refund overpayments.
How to request a refund if it doesn’t come automatically
Schedule an appointment with the Taxpayer Assistance Center by calling 844-545-5640. When you finally speak to an agent, explain that you overpaid and would like a refund rather than applying the extra to next year’s taxes. Hat Tip: Rapid Travel Chai via personal communication.
Do you need to mail in payment vouchers?
No. No payment voucher is required. You don’t need to send in a voucher if you pay by card.
Pay with Paypal
Both ACI Payments and PayUSATax allow payments via PayPal. Sometimes cards like the Discover It, Discover It Student, and Chase Freedom offer 5% rewards for Paypal purchases (up to $1500 combined spend per quarter). Tax payments during these times should count!
NOTE: There is a weird issue with selecting to pay with PayPal on the PayUSATax website. When clicking the PayPal button, a screen flashes up and disappears. Here is a work-around that has worked for some people, but not all: Put in valid credit card information first (for any credit card) and then press the PayPal button. When doing it this way, I got the PayPal screen to successfully load.

Pay with Samsung Pay & Google Pay
Some tax payment websites support mobile wallet payments such as Samsung Pay or Google Pay. The US Bank Altitude Reserve card earns 3X for mobile wallet payments, so it should be a great match. However, readers have reported that Samsung Pay and Google Pay are only supported through Visa Checkout and that this does not trigger the Altitude’s 3X rewards.
Top 5 reasons to pay federal taxes with a credit card or gift card
1. Profit w/ a 3% Cash Back card
A number of credit cards earn cash rewards greater than 2%. Some even earn 3% cash back:
- The new/updated Paypal Mastercard will earn 3% cash back on all PayPal purchases. Details here. This approach will work only with the services that allow payment through PayPal.
- The Paceline card earns 3% cash back for all spend on weeks in which you meet the app’s exercise goals.
- The Discover It Miles card earns 3% for the first year of card membership (you earn 1.5% and then at the end of the year all cash back earned is doubled).
Since you’ll earn 3% cash back on both the base tax payment and the processing fees with the above cards, your profit will be slightly more than 1% of your tax payment.
Example:
- $10,000 tax payment + 1.96% fee = $10,196
- Cash back earned at 3% = $305.88
- Profit = $305.88 – $196 = $109.88 (1.1% of $10K)
For more examples of cards that earn better than 2% rewards, see: Best Rewards for Everyday Spend.
2. Meet minimum spend requirements
If you recently signed up for new credit cards, chances are good that you have to spend thousands of dollars in order to earn the associated signup bonuses. Paying taxes is a cheap and easy way to accomplish that.
Below are some of the most valuable current welcome bonuses for consumer cards. If you’re interested in business cards, please click here to see the best business card offers.
Click on a card for details; Press “Next” to see more offers:
Card Offer
3. Buy points cheaply
Several credit cards offer up to 1.5 transferable points or miles per dollar. In these cases, a 2% tax payment fee (rounding up a little) means that you can essentially buy miles for 1.3 cents each. Even better, some cards earn 2 transferable points per dollar for all qualifying purchases. With these 2X everywhere cards you can essentially buy points/miles for 1 cent each. Either way, if you plan to use your points toward high value awards, this is a cheap way to acquire those points.
2X Example:
- $10,000 tax payment + 2% fee = $10,200
- Miles earned at 2X = 20,400
- Cost per mile = $200 / 20,400 = 0.98 cents per mile (round up to 1 cent per mile)
1.5X Example:
- $10,000 tax payment + 2% fee = $10,200
- Miles earned at 1.5X = 15,300
- Cost per mile = $200 / 15,300 = 1.3 cents per mile
Cards that offer 2X transferable points per dollar:
Note that some cards offering 2x everywhere are not included below because their points are worth much less than airline miles. An example is that most Marriott cards offer 2x everywhere rewards.
- Citi Double Cash: Earns 2 cents per dollar, uncapped. Cash rewards can be converted to ThankYou points, and when paired with a Citi Premier or Prestige card, those points can be transferred to a selection of airline and hotel programs.
Card Offer and Details - Amex Blue Business Plus: Earns 2 Membership Rewards points per dollar on up to $50K spend per calendar year. Points can be transferred to a large selection of airline programs or to a few hotel programs.
Card Offer and Details - Capital One Venture, Venture X, or Spark Miles. Capital One offers three cards that earn 2X “Miles” per dollar on all qualifying spend. These “miles” can be transferred to airline miles & hotel points, usually at a 1 to 1 rate. This means that the following cards are capable of earning 2X miles everywhere:
Card Offer and Details
Cards that offer 1.5X points or airline miles per dollar:
- Chase Ultimate Rewards. Two no-fee cards in Chase’s lineup earn 1.5 Ultimate Rewards points per dollar for all spend. Pair either one with a premium card (e.g. Sapphire Reserve, Sapphire Preferred, Ink Business Preferred) to transfer points to several airline or hotel programs:
Card Offer and Details - Amex Membership Rewards. Amex offers two cards that are capable of earning up to 1.5X. In either case, points can be transferred to a large selection of airline programs or to a few hotel programs. Note that the Everyday Preferred card requires 30 charges per billing cycle to earn 1.5x, and the Business Platinum card requires purchases of $5K or more to earn 1.5x when paying taxes.
Card Offer and Details - Airline miles. A few airline branded cards offer 1.5 miles per dollar for all spend:
Card Offer and Details
4. Earn valuable big spend bonuses: elite status, free nights, companion pass, etc.
Many credit cards offer bonuses for meeting high spend thresholds. You can find a comprehensive list here: Best big spend bonuses. Here are a few examples:
- Amex Delta Reserve or Delta Reserve Business: Spend $30,000, get 15,000 Medallion Qualifying Miles (towards elite status). At $60,000, $90,000, and $120,000 you’ll get another 15,000 Medallion Qualifying Miles.
- Amex Delta Platinum or Delta Platinum Business: Spend $25,000, get 10,000 Medallion Qualifying Miles (towards elite status). At $50,000 spend, get another 10,000 Medallion Qualifying Miles.
- Southwest Plus, Southwest Premier, or Southwest Business: With Southwest, when you earn 125,000 points in a calendar year (including points earned from credit card spend) you get a companion pass good for an unlimited number of flights for the rest of that year and all of the next calendar year.
- Barclaycard JetBlue Plus, or JetBlue Business: Spend $50,000 and get Mosaic status which offers free changes and cancellations; free checked bags; expedited security; early boarding; free drinks; enhanced point earnings; and 15,000 bonus points upon qualifying.
5. Liquidate Visa/MasterCard gift cards cheaply
Visa and MasterCard gift cards are debit cards. As such, they qualify for low flat fees for debit tax payments: $2.20, $2.50, or $2.55 (depending upon the tax processor you use). In other words, your cost to liquidate $500 gift cards will be approximately half a percent. That’s pretty cheap.
If you use $500 Visa/MasterCard gift cards, then you can pay the following amounts:
- PayUSAtax.com ($2.55 fee): Make a $497.45 payment with a $500 gift card.
- What is known to work:
- What sometimes works:
- Vanilla brand Mastercard gift cards sometimes work with PayUSAtax and sometimes do not. The ability to pay with these Mastercard gift cards through PayUSAtax seems to come and go.
- What is known to not work:
- Vanilla brand Visa gift cards are not recognized as debit cards at PayUSAtax.com and so they will incur the higher credit card processing fee.
- Metabank issued Mastercard gift cards are reportedly not working at PayUSAtax (Reported again on 5/26/21 by Dokus).
- Pay1040.com ($2.50 fee): Make a $497.50 payment with a $500 gift card.
- What is known to work:
- Metabank issued Visa gift cards (including from Simon Mall) appear to be working again. Reported by Rosco in October 2021. But Vince reports otherwise in November 2021. YMMV.
- Metabank issued Mastercard gift cards are working as debit cards. Reported by StepheH. Reported again on 5/26/21 by Dokus.
- Sunrise Visa working as debit at Pay1040.
- Vanilla brand Mastercard gift cards work at Pay1040. Reported by Yue.
- What is known to work:
- ACI Payments (Previously named “Official Payments”) ($2.20 fee): Make a $497.80 payment with a $500 gift card.
- What is known to work:
- Metabank issued Visa gift cards (including from Simon Mall) appear to be working (note though that this seems to come and go over time). Vince reported problems with Simon gift cards in November 2021. YMMV.
- Vanilla brand Visa gift cards work at ACI
- What is known to work:
The biggest problem with this (besides the fact that what works and what doesn’t work keeps changing!) is the IRS imposed 2 payments per processor limit. This means that you can liquidate no more than 6 gift cards per type of tax payment. In the past, Official Payments allowed more payments via phone. Recent reports, though, indicate that this is no longer the case.
See also: Best options for buying Visa and MasterCard gift cards.





Hey Greg – any recent DPs of tax payments not qualifying for Amex MSR? Was just told by a rep I had only met 50% of spend on a (now expired) MSR period for Biz Plat in which half of the MSR was done via paying taxes according to this guide. I’m worried I’m SOL on 150k MRs.
I received partial welcome bonus on Marriott Bonvoy Brilliant card (50K points instead of 150k points, I did receive the free night cert) and Amex rep opened a case. The back office response was that spend threshold has not been met due to tax payment transaction not eligible.
I argued that the T&C only states that the purchase of cash equivalents is not eligible. Tax payments are neither a purchase of cash equivalents nor listed in the prohibited list. The 2nd rep noted this down as a dispute to the back office response to the case. It took 5 calls over 2 months before I did receive the balance 100k points.
In my case I also questioned the case response as dubious because if requirements are not met then why was partial welcome bonus awarded. I have same problem unresolved with the Marriott business card (partial points and only 1 of 2 FNC), and have not been able to call repeatedly to pursue it since each call takes an hour or so.
No other datapoints that I’ve heard.
I was just told by Amex that tax payments do not count toward points/bonus spend
Thanks Tim. I’m pretty confident that reps who say that are misinformed. I haven’t paid taxes recently with Amex so I can’t prove it myself, but I bet many others have. Can anyone here chime in with a recent datapoint showing that Amex cards earn points & welcome bonuses when paying taxes?
I accidentally overpaid my taxes via CC, but didn’t get a confirmation number or email. Did my payment get through? How long does it take to post to CC? It’s been 2 days and no confirmation email or pending transaction on my CC.
It sounds like the payment didn’t go through. You should at least have a pending charge right away.
DP: Paid estimated taxes with Nearside debit card using PayUSATax. Was charged flat $2.55 debit fee. Received 2.2% cashback from Nearside on both the tax payment and the debit fee.
Good to hear!
Can also confirm receiving 2.2% back on PayUSAtax with Nearside.
I searched, but didn’t see anything here about the Amex Rewards Debit Card. Unfortunately, my Datapoint is that it seems like ACI would accept it, but as a credit card with the 1.98% fees, and PAYUSA tax thinks it is an invalid card number. I already used my two payments on pay1040 with a credit card, so I didn’t try there. Disappointing, because that would be a great use of the Amex Rewards Debit.
Thanks for that info. Disappointing but not unexpected
When filing a joint return and making 3+ payments, do you need to switch the Primary tax payer to get more than 2 payments or does it not matter?
You can do more with a single tax ID by switching payment processors.
Hi, Greg. I just used a Vanilla brand debit Visa to pay estimated taxes at PayUSAtax.com. So it’s accepting that brand again, at least for the moment.
Glad to hear it!
So let me get this straight…I can connect my Citi Premier MC to my Paypal account, pay my taxes with Paypal and get 3% back, and then apply the dollars toward my minimum spend on the Citi card when I pay off the Paypal stmt?
Am I missing something here?
Not exactly. 3 percent back is by paying with the new PayPal MasterCard through PayPal
You need to stop advertising Nearside as “unlimited 2.2%” cash-back. They are not.
Learned hard way they are offering “2.2% cash back at participating merchants”
Don’t even dream on cash back on tax payment or regular online payments with the card. But you could have 2.2% at PANDA EXPRESS
DP above disagrees with you.
Maybe he need to try it before “disagreeing”
I actually made a payment and iT WASNT counted toward cash back. I called CS and got and explanation about “selected merchants”. Telling you, near side is a dud.
Hey Arch, you made a similar comment on another thread and I never head back from you regarding DP.
I think what Rob was trying to point out is that a commenter above paid taxes with Nearside and got cash back on the entire amount.
Which merchants did you not receive cash back on? I haven’t yet run across that with any of my purchases (including utilities) and haven’t heard any reports of cash back being denied, so would love to get more specific DP’s from you.
Hi Tim,
My bank is accepting debit card as method of payment. I tried Nearside and they did not count this as transaction eligible for cash back. I called CS and got the story about “participating merchants listed on web site”. Btw here is disclaimer from Nearside website:
Thank you,
A
Would paying $500 via Custom Cash followed by paying the remainder via Citi Double Cash be the best option? Would it code as 5% for Custom Cash?
No, 5% only applies to covered categories. Plus you’d pay 1.87%.
The smart move is to buy a $500 prepaid Visa/MC gift card at a pharmacy, which will get you 5% back, then pay with the prepaid card which will qualify as a debit card when paying taxes.
Key question about paying Federal taxes with Plastiq: How long does it take for the payment to go through?
This should probably be addressed above and on the dedicated Plastiq page, which, at present, only says (generally) that “payments by check usually take about a week, but two weeks is not unusual.” I don’t know if that applies to Fed. tax payments, but if it does that obviously won’t work when close to the due date.
@Kent, set up your login with IRS.gov through ID.me and you can see the details for your account, including date posted.
If I use Pay1040 to pay my jointly filed annual federal taxes, can I split the payment across 2 different credit cards, to meet two points promos I am chasing? Is it okay to make both payments in my name, since I am the primary tax filer?
Yes that’s fine. Just make two separate payments of however much you want to charge to each card
If I generally get a refund, can I still pay estimated quarterly taxes and just get refunded the difference. Need to meet minimum spend on my new Platinum Card
Yes
Do I have to pay in all four quarters?
No
@David, that’s very creative. High-five.
Should I be worried that no estimated payments made a year ago for tax year 2021 are showing on the IRS website? Payments are showing for every year before tax year 2021. This is for the primary SSN.
Surprisingly, P2 sees their estimated payments on their logon (but not any of the payments made by P1; those aren’t showing anywhere).
What happens when paying an amount that contains pennies, e.g. $500.12?
I thought the IRS only deals in whole dollars. Or do they add all estimated payments and round, i.e. 499.50 would turn into $500?
I don’t think there’s a problem unless you use TurboTax due to a known rounding problem. Outside of Turbotax, I believe that the IRS allows you to round to the nearest dollar but you don’t have to do so. Below is what I posted previously on here about what happened to me last year using TurboTax:
“Some of you may benefit from knowing how I got into this mess: TurboTax rounded my payments to the nearest dollar, which meant that it under-reported my payments by $1. (I made numerous payments via credit card). They sent me a letter to which I responded, but they still held my $8,000+ refund for 8 months. Ridiculous. So, if you use TurboTax (which I certainly don’t recommend), I suggest either ensuring your payments are in whole dollars and/or carefully checking to be sure that TurboTax doesn’t do any rounding.”
Pay1040 is good and is the cheapest, but the problem is they do not have all of the possible forms and there is no way that you can fill in the information that is not listed. When I called them about a form that was not listed they suggested I use one of the other providers but those are more expensive so my return was less. Not good.
When I filed my tax I chose credit card for payment (which h&r block direct me to pay1040 with higher rate), I then opened another tab and proceed the payment. And I just noticed this site suggested to select pay by check instead.
Should be be worry about what I did?
According to the IRS, the tax due date is 18 April 2022, not 15 April (likely due to the Good Friday on the 15th).
Thanks! Fixed.
Any thoughts on NYS taxes, which charges 2.25%?
What kind of thoughts are you looking for?
I was wondering if Nick came up with a clever idea for NYS taxes? 🙂
was approved of chase ink case but only 3k credit limit. I know my taxes are more than 3k, can I use card multiple times but pay off balance and use it again? idk if that will prompt them to close my account.
It’s called cycling credit. In general, banks don’t like it, but if you do it once it should be ok. I had to do it twice to do the $7500 MSR on Ink Cash/Unlimited with a $3k limits.
You can cycle credit as long as you pay it off. I do it all the time. Never had an issue.
Do the tax payment and the fees show up as two different charges on the credit card? or combined into one charge?
Two different charges with pay1040.
I believe they all show up as separate charges
One thing to note for those who pay taxes for someone else. This is normally no problem and was not in 2021. This year (via PayUSAtax only) there is an issue when the taxpayer’s zip code is different from the payer’s debit card zip code. It just does not accept that – at least for a debit card payment. Tried many times, complained to PayUSATax, but it seems they didn’t do anything to fix it, at least as far as last month anyway. No problem with the other 2 payers.
I will try again for Q2 2022 and see. Will update if anything changes. Very annoying.
I had the same problem today for myself – the taxpayer zip and the debit card zip were the same. PayUSATax kept telling me the Zip Code didn’t match when it was entered correctly. Other two processors worked fine. This is with Simon Mall/Metabank debit cards.
If you use the schedule payment option it works for one payment at a time and charges the card the following morning at 5am. This bypasses the zip code problem as a temporary fix.
I am hoping someone can shed me some light here and i know it sounds a stupid quesiton but i couldn’t find the answer. I see lots of writing about how to make payment via credit card and i got that part. However, I don’t see any writing on how to submit the income tax to IRS after make the payment. Normally I used Turbo tax on my PC do the filing and paid online via Turbo tax. So when I pay via pay1040.com, I don’t see an option allow me to submit my tax return file to the IRS? I am very much appreciated for any help.
Never mind. Found it.
where is that option? I didnt get anything to submit while I was going through pay1040
Just ran into your blog. I have a 100k tax burden for this year. Unfortunately, I don’t think I’ll have enough time to sign up for a card. I currently have the CSP and Chase Ink Business Unlimited, as well as Chase freedom. Are any of these worth using to pay off my taxes?
Probably not, but if you had a need for lots of Ultimate Rewards points it wouldn’t be terrible to use the Ink Business Unlimited to get 1.5 points per dollar
Wouldn’t be terrible at all if you want to transfer them to Hyatt. For those of us in the Hyatt ecosystem, it’s not hard at all to get a meaningful $0.02 per Hyatt point, so while manufacturing 150,000 Hyatt points at a cost of $1,960 is not something I would probably choose to do, if I had to spend $100,000, the opportunity to get 150,000 Hyatt points for an extra 2% is not a bad one.
I’m writing this after just returning from a wonderful stay in a super-large suite at a very elegant property, at 18,000 points. Would I have paid $1,000 for the suite? No. How about the $500 that corresponds to the absolute low off-peak price that occasionally is possible. Nope. But for $235, i.e., the 1.96% fee a tax payment on $12,000 that yields 18,000 points … all day and all night!
You could get Amex Business Platinum and get the number instantly. You’ll earn 1.5MR per $ for payments over $5k. SUB is 150k I believe. The only issue is your limit probably won’t be $100k so you need multiple cards to max out this spend.
Don’t forget 3% cash back anywhere with the Paceline card. This card is amazing!, as long as you get 150 minutes of exercise a week, which you should be doing anyways, and it counts walking!
Can I still make 2021 federal taxes payment on Plastiq before I file my 2021 return next month? Any DP if the payment posts?
Good news and bad news. My accountant just called me and told me I’m getting a huge refund for 2021 on taxes – I had planned to use a credit card to pay so I’d get points. However, I do have to do quarterly New Jersey 2022 tax payments.
Can I use pay1040 or payusatax for state quarterly payments?
Thx
A refund is never good news. You just gave the government an interest- free loan for a year and could’ve been investing that money.
I know. I blame my accountant for telling me to make qtrly payments when I didn’t need to.
Art, it’s not all bad news. See David’s post above, and Esquiar’s just below…make the payments anyway, get the points, and IRS will refund the overpayment. I think that would work for you. Only downside is waiting for IRS to process the refund. If that opportunity cost is OK with you, then you’re fine.
How are people doing with refunds? I filed early March, still waiting for $4k refund…
Update: got refund a month after filing, only a week later than IRS 3 week target. I made one large overpayment to max out a promo in December
What you don’t discuss is merging points to create a greater value. For example, while the Chase Freedom earns 1.5% back, if you have the Reserve card, then depending on how you redeem the points, it could have a 50% bonus.
Any idea if you pay with EIN can you do 6 payments in addition to SSN?
TIN?
Actually, it’s a due date of 4/18/22 or 4/19 this quarter.
From the IRS website:
“April 18 tax filing deadline for most
The filing deadline to submit 2021 tax returns or an extension to file and pay tax owed is Monday, April 18, 2022, for most taxpayers. By law, Washington, D.C., holidays impact tax deadlines for everyone in the same way federal holidays do. The due date is April 18, instead of April 15, because of the Emancipation Day holiday in the District of Columbia for everyone except taxpayers who live in Maine or Massachusetts. Taxpayers in Maine or Massachusetts have until April 19, 2022, to file their returns due to the Patriots’ Day holiday in those states. “
Today I successfully made payments using vanilla VGC on pay1040 and aci payments (federal), and ACI payments / officialpayments.com (CA state). However I am not getting payusatax to work for vanilla brand VGC, even if I use it as a credit card option rather than debit card option. It is telling me the billing zip code does not match. Anyone else having this problem as well?
I have the exact same problem with Simon Metabank VGCs on payusatax as well (see 3 entries earlier). Just ordered another batch to see if problem fixed. If not, will have 1 less vendor to burn cards.
Did you try the other VGC such as that issued by Sutton Bank? I was wondering if it’s the Metabank or it’s the VGC in general.
No, I haven’t tried VGCs from other banks. I use Simon Metabank VGC exclusively because of the $1k value.
I just tried cards from a new batch, still doesn’t work.
I was able to make several CA state payments on ACI payments on Mar 25th using Vanilla VGC, but I bought some new Vanilla VGCs later, and wasn’t able to use those to make additional state payments. I get a generic error of “The system encountered an error while trying to process your request.” Anyone else experience any issues with ACI Payments recently?
Today, Simon Gift Cards coming up with this zip code error on the PayUSATax site. The cards are working on the other sites.
It is probably the same issue I posted about today. Zip code mismatch on payment card address vs taxpayer’s zip code. Try and see if you can add an address to your vanilla card and use the same zip as taxpayer.
In my case my debit cards have my real address on them so it doesn’t work. Had this issue since early 2022. It seems to be an issue with PayUSAtax, unless they just don’t like Vanilla cards which I don’t use.
OK, made my payments looking for 125K MRs. Hope the IRS does their job and processes in a timely manner. HAHAHA
what is the correct form to use? current tax year 2021 or estimated tax 2021?
Just tried 8 different Simon Metabank GCs on PayUSATax, 4 of mine, 4 of my wife’s, all declined, stating zip code didn’t match card on file. However I used those same cards on Pay1040 and ACIPay and all went through fine. This is as of Jan 14 2022. What’s up with PayUSATax?
Bump, anyone else have luck using Simon’s Metabank VGC on PayUSATax? Mine are still not working. Probably going to get another batch and try some new cards.
Just successfully made 2 payments on PayUSATax using $1000 Simon VGC (I don’t know if they’re Metabank) this evening.
See my earlier posts.
[…] Paying Taxes With Your Credit Card: It’s everyone’s favorite time of year again…. Yes it’s officially tax season. If you have to pay your taxes, you might as well earn some points while doing so. Here’s a great guide for you to follow. […]
A Simon/Metabank GC worked for me today at PayUSATax as debit for $2.55 fee.
I had the opposite experience with PayUSATax today; two Simon mall Metabank issued Visa GCs (card #s beginning with 4088) did not work. The website returned a message indicating the card is not a debit card. But, a Metabank issued VGC (card # beginning with 4358) purchased at a supermarket processed as debit.
I currently have zero debt with the IRS, but will have a large bill due when I file my 2021 taxes. If I process payments prior to the Q4 estimated tax deadline (Jan 18), can that payment be applied towards my 2021 taxes (due in April 2022)?
yes, a payment made now will apply to your 2021 taxes and should be reported on your 2021 return
Just my experience with the online federal tax payment services.
1st quarter 2021 I made 6 payments (2 each thru the services) since I had an Amex offer to spend $500 get $50 back 10 times. When it came time to make the 2nd quarter payments, none of the services would let me pay. Just to double check I did it again in the 3rd qtr at one site and it was still a no-go. Finally, end of December I decided to try again and it went through.
So, in my case, by using all 3 services twice, it’s possible that the system basically credited my 2 per quarter payments for the first 3 quarters in the first quarter. I don’t know if this was WAI or not.
Dumb question, I need to make $5K in payments to CA, and the service charge is 2.3%. I would be paying with Freedom Unlimited 1.5X spend. I am not working towards any bonuses, etc. My principal goal is to redeem UR for Southwest flights, since I need to visit family very frequently.
Does it still make sense pay the 2.3% service charge? Thanks,
Hi fellow, Ian!
It would only be worth it if your Southwest flights offer a really good redemption value. At a 1.3¢ per point average redemption value, 1.5 pt/$* 1.3¢/pt == 1.95¢/$. You would need to redeem at 2.3 / 1.5 == 1.53¢/pt. in order to break even, and even then remember that you wouldn’t earn tier qualifying points nor redeemable points on award tickets.
If you can, you should jump on a new cc welcome bonus, perhaps for one of the Chase Ink cards since they have higher minimum spend requirements that the $5k tax payment could cut far into.
Great post on this topic. I’m going to use this current payment period to finish up a new Amex Platinum spend but this takes me back to my recent question on your podcast regarding the CRO crypto cards with up to 8% back and I assume function as a debit card in this case. However, I then realized that the earnings (% back) can be taxed by the IRS as crypto income if the price is higher than acquired. Freaking taxes, so complicated. Can’t we just go to a flat tax?
I suggest updating to suggest two inter-related advantages to over-paying taxes:
2021 Tax Year Due Dates
SHOULD SAY JANUARY 18 as in the update box at the beginning of the post
Can the Point Debit card be used for paying taxes with one of the IRS vendors, and if so, does it code as a “debit card” with the lower $2.00 fee per transaction?
Besides the 4 quarters of estimated federal taxes there is also the final tax for the year. So, right now you can make up to 6 payments (2 per processor) for 2021 (not estimates). Then you can also make estimated taxes for each quarter for 2022.
That comes to 30 payments per year, and if you are married and desperate (surely that could never be the case?) and are willing to risk some potential hassle you can do the trick of each spouse paying separately for twice as many payments – but make sure you can handle the cash flow in case this drags out a refund for months. And this is not even taking into account filing an extension or an amended return …
As always, don’t be too greedy.
Anyone tried to use Vanilla VGC (sutton bank) or Vanilla MGC to pay tax via PayUSA recently? Any success stories? Thanks.
No, but I used Vanilla VGC (metabank) today with no problems at PayUSA Tax.
Thanks. I am not able to find Metabank version Vanilla GC here in bay area safeways. I appreciate if someone can share which grocery store in bay area carries Metabank version Vanilla GC.
Huge F***ing caveat! I set myself up for some spends and needed to manufacturer to cover them. “Loaned” the Government $7,200 by overpaying my taxes on my credit cards in February 2021. It is now 01/07/2022 and my return is still being processed and my refund in on hold. My return is a generic W2 scenario with no creative deductions.
At least you’re earning 3.13% on that money annually. There are no savings account/CDs with a better rate right now.
Seriously? That actually makes me feel better! My only concern is the if/when I get reimbursed.
Still waiting too, but for way less ($500). Glad to know I’m not alone.
From what point do we start to earn that interest? lets say i make a payment now of 100$ for this quarter and file tax in 2023 around March. Can I expect 3$ interest?
Thanks!
You start earning interest after April 15th 2023 or your filing date (which ever is later).
Same here! I paid 11000 get get the chase ink bonus points. Still haven’t received it back. I have called several times and talked to them on phone but they just say due to covid it hasn’t been reviewed. Now I can see that negative amount in 2021 transcript, not in 2022 trascript.
It’s starting to make me nervous, looking back I wouldn’t do it. Too much headache and uncertainty.
I went to make some payments today and found that the ACI Payments debit card fee has raised to $2.20 from $2.00
Thanks. Updated.
Pay1040.com has decreased their CC transaction fee to 1.87%
Thanks. Updated.
I haven’t actually tried using it, but it looks like ACI Payments now offers a PayPal payment option as well. Hopefully there’s more PayPal category bonuses in the future!
delete
Is PayUsaTax.com down?
Sorry if this has been answered already (I couldn’t find it), but can the Point Debit card be used for paying taxes on any of these websites and, if so, does it code and charge as a debit card for the lesser fee?
Here is how to work around the PayPal payment bug on payUSAtax when you’ve already made a previous payment for that tax type/year combo.
Sign up for an account and use the “schedule future payments” feature.
THANK YOU!!!!
Big thanks taxpayer! Can confirm I set this up as you outline yesterday and it went through early today. I did P1’s Marriott Amex card a month ago but was stuck for P2 until coming upon this.
thanks!
“Put in valid credit card information first (for any credit card) and then press the PayPal button. When doing it this way, I got the PayPal screen to successfully load.”
This trick is not working for me. I noticed this is happening to me because i am trying to make a PayPal payment for a second time on the same day (to use a different Freedom card). If I change my SSN slightly then the PayPal popup works.
I will wait a day or two and see if this issue goes away by itself.
w2 – want to pay towards 2021 taxes. Looks like I can’t even make 2021 payments? So I can wait until 2022 to make a payment? Just want to make sure that I am not screwing thing up these last few days of the year
Pay 2021 estimate
Does paying tax with Paypal trigger 5X category on Freedom card? Thanks in advance.
Yes (didn’t you read the post?)
I have the AmEx Biz Platinum with the 4X bonus and have until February 16 to complete the bonus spend of $25,000. I am going to owe some capital gains tax due to selling a property this year. I don’t believe, even with my MS with buying groups, that I will be able to hit the $25,000 threshold and am considering prepaying $10,000 towards my tax bill. Is it advisable to do it all at once or should I break up the payments, making a payment each month or maybe 2 payments of $5,000 each to get the 1.5X points on spend of $5,000 or more?
I can’t think of any reason why you should break up the payments.
Vanilla Mastercard gc currently not working PayUSAtax
By reading the issues of paying via PAYPAL, I was wondering if there is anyone that had luck to pay successfully via PPL in the last several days.
worked for me a first time earlier today. Can’t get the popup to stick a 2nd time because the system knows I already paid via Paypal once. Will wait a day or two.
Thanks for the tip on the Paypal issue. I was pulling my hair out and trying to see if I did something that made it think I had more than 2 payments in this quarter or if they had a different definition of a quarter (since I had only made one so far and not with Paypal). I will try it out and report back this evening.
Amazing that you even thought of trying this out – I thought I had tried everything before giving up and waiting for December 15 in case their quarterly calendar reset on that date (they do have some weirdness in how they figure quarters for the 2 max estimated quarterly payments).
Sorry to report, this Paypal bug “workaround” did not work for me.
Strange: it worked for others. What happens when you try it?
Didn’t work for me either at about 2am this morning. Got a brief popup which quickly vanished. The workaround didn’t seem to matter; same behavior. Tried two browsers on a Mac with same results.
Unfortunately, I can’t reproduce the problem anymore. Now, I don’t even have to put in cc info for Paypal to work fine. I’ve tried both from the original browser window, and from an incognito window in Chrome on my Windows laptop, and from the Microsoft Edge browser.
Greg, I too was pleasantly surprised to see your workaround as well for PayUSATax. Like Mikey, I’ve been struggling with this issue for months. In fact, it hasn’t been since Q1 this year I could make 2 PayPal payments in one quarter via PayUSATax.
Unfortunately, your workaround did NOT work for me either. And I tried every single browser out there. I hadn’t thought of Mikey’s idea that trying after 12/15 could “fix” the issue, though I tried periodically throughout Q2 and Q3 with no success.
It is clearly SSN-related. If I put in my spouse’s SSN, the PayPal screen pops up fine. I can reproduce this every time; I’m surprised that you cannot after you made your first quarterly PayPal payment.
I also am not sure if your comment that you can pay with two different taxpayers (if you file jointly) is a risk worth taking with PayUSATax either? I think Nick mentioned that he simply flipped the primary and secondary person’s SSN on other sites and that idea makes a lot of sense. Unfortunately, with PayUSATax they don’t give an option for a secondary person.
Is it worth $75 (5%) to have to wait on hold for at least an hour and have the IRS rep manually transfer the money over from one spouse’s account to the other? Another reader reported getting the “underpayment” letter from IRS….which also sounds like a less-than-ideal outcome.
Any other thoughts/ideas you have are much appreciated. Like Mikey said, I’ve been tearing my hair out for months on this one!
ha ha – we have at least 2 soon-to-be-bald Frequent Milers now in pursuit of this miles and points hobby 😀
On a serious note, @EastsideBK, I agree with you on the spouse SSN. I have done that once a few years ago, and I can’t remember exactly what I had to do to fix it (I definitely didn’t call the IRS) – I think my accountant had them fix it electronically somehow. Probably cost me more than whatever benefit I derived, though the amounts were larger in my case (not the $1500 paypal 5% limit) since it was in pursuit of some large spending bonus then. But still not worth it, at least for me, to have to deal with the bureaucracy, so I have just tried to use my 2 per payment processor per quarter limit more strategically since then.
As others have helpfully replied on this point before I could get to it, it did behave exactly the same way with and without CC info. Tried different browsers, different credit cards even (Visa/MC) all with the same unsuccessful result. The popup flashes briefly and goes away. Oh well!
Can you try a different SSN just to get the Paypal box to come up successfully, pick your credit card through PayPal and then go back and change the SSN? I haven’t tested to see if it allows that… just wondering.
Already tried a different SSN yesterday and yes that made the paypal box come up. But it appeared from the button text (not sure) in Paypal that hitting submit would complete the transaction (not go back) so I didn’t risk it at that point.
Mikey, I’m 100% with you on everything you’ve said. Greg’s idea is interesting (re: trying a different SSN and then going back) but I don’t know what happens when you hit “Submit” either. In other news, your idea that PayUSATax’s calendar may reset after 12/15 did not work either for me tonight.
This is totally strange if you think about it…..their website must be hard-coded to only allow 1 PayPal payment per quarter even though their website clearly says that you can make 2 per quarter:
Tax Type: Quarterly
Maximum Payments: 2 Per Quarter
https://payusatax.com/IRS/Home/LoadStaticPage?pageName=FAQ#14
I’m fresh out of ideas…..
Yes, very strange. Just a minor correction – I have done one NON-paypal payment (on 9/15) with payUSATax, so its also not that I used up the one quarterly paypal payment as you indicated. And I definitely know 2 credit card payments per quarter do work for many years.
Yeah, that 12/15 reset theory didn’t pan out 🙂
I’ve gone through the Paypal Popup window and selected a credit card and can confirm that pressing OK (or whatever the button is on the Paypal popup) does not cause the transaction to complete. You get taken back to PayUSATax to finish up.
yes, but when you go back and change your SSN and name then you at at the beginning of the loop again.
I also confirmed it is SSN related. I switched to my name and my SSN (even though my spouse is primary and has made 1 PayUSA payment this quarter). I was able to bring up the PayPal popup and complete it in my name. Hope it is okay!
This is a good idea. Anyone tried?
Mikey, is this your 1st payment on PayUSATax for this quarter?
Yes, either first or second depending on how they define “quarter”. I had a payment on 9/15 by credit card, not paypal. I wasn’t sure if their quarter was based on tax deadlines which is the 15th of the month or actual calendar quarter. I actually have zero prior payUSAtax payments in calendar Q4 and this is the 1st one in that case.
Any data points whether a EIN for a LLC is considered separate on the 2 payment limit? I already maxed out with my SSN for my quarterly payments.
Does anyone have any concern about giving your SSN out to another company to pay taxes?
Has anyone had any trouble with the payments posting when using the primary SSN?
Thank you!
Never a good feeling when you are required to give your SSN out but have not had any problems so far with the 3 online tax payment processors authorized by the IRS.
No trouble yet with tax payments posting when using the primary’s SSN. Primary is spouse, me second. I use a credit card only in my name, and everything has alway recorded properly. I created an IRS online account to view receipt of payments for peace of mind.
Its a legitimate concern, and one that I had initially as well. But these payment processors (at least the 3 authorized ones) are linked to, directly from the IRS website (google IRS payment by credit card) and seem to be blessed by them, So I think its a lot less risky than other places where we give out SSNs to private companies (not just banks and employers but no-name employment background check companies, new wireless phone service, even individuals such as a landlord or leasing company) as a condition of obtaining services. Plus logically, there is no other way for them to apply it to your taxes other than using your SSN as your “account number” with the IRS. The worry of course, is the risk of not just intentional abuse but inadvertently being affected if their servers get hacked. However, after companies like the large credit bureaus, Target and T-mobile – among others – compromising our SSN data with lame security processes, I just assume there is no more or less risk of that, than in other legitimate places you have to share your SSN. Just my 2 cents.
Also, never any trouble in years of using it multiple times each year with all 3 processors, as long as I used the primary SSN and matched the names and addresses exactly as my previous tax returns (though not even sure if that matters).
Seems clear to me that the best cash back card to use routinely for this if you pay 6 figures in tax estimates is the B OF A platinum/diamond level rewards cards with the 2.625 everyday spend rebate. Not everyone has this situation of course and actually only saves 625 buck per 100k, but better than nothing.
My spouse and I filed tax return jointly and I am the primary person. We made some estimated tax payments via credit card online. Question is if we put my spouse’s SSN when submitting the payment online, will it cause any issue? Is IRS smart enough to figure out I am the primary person though my spouse’s SSN is entered in the payment? Thanks.
thanks for this post. Didn’t think / know about the PayUSATax/Paypal angle. Just had a $5k tax payment required come up…so this could be useful. Put spend on Marriott card or go for the $8k Hilton free night offer. decisions decisions.
A potential stack with the Marriott Amex Paypal offer–there are spend offers for 7500 points with $7500 spend on the Marriott Amex cards (which came out at the beginning of the year). By itself this is not compelling, but I plan to max out the Paypal offer with a tax payment, which will get me close to this additional bonus.
Estimated taxes for 2nd quarter are usually due June 15 (except for one exception in 2020). Please double check the date you have posted.
Good catch! Thanks. Fixed.
One other opportunity is that in overpaying up to $5,000, you set yourself up for the ability to buy more U.S. Series I Savings Bonds than the normal $10,000 per year per person. E.g., with an employee card on the Amex Business card, that’s 27,500 MR points for the $5,000 spend, plus 20,000 points for hitting the $4,000 on the employee card, plus the best savings rate available, for about $99.
I cut the following from the IRS website:
Buy U.S. Series I Savings Bonds with a portion or all of your tax refund for yourself or anyone. Issued by the Department of the Treasury, Series I bonds are low-risk bonds that grow in value for up to 30 years. While you own them they earn interest and protect you from inflation.
Buying savings bonds with your tax refund is simple and easyJust tell your tax preparer you want to buy savings bonds with part or all of your refund! If you prepare your own return using tax software, the computer program will guide you. If you file a paper return, use Form 888, Allocation of Refund (including Bond Purchases). The instructions explain what you need to do.
Interesting angle, thanks for sharing!
Are you absolutely sure you can’t pay estimated taxes using a credit card in early January? If you are basing your answer on the faqs of some providers, I think they update them in January to push the dates forward a year (ie, they will accept 4th Q 2021 payments in January 2022). This concerned me a lot a few years ago until I “broke the code”. I have made 4th quarter payments using credit cards in January many times. The reason this matters is it is a great way to kill annual spend requirements (for example, $25k on Delta, $15k on Hilton Surpass, and now on a calendar year $15k on Hyatt). If something changed this year, this is big news, but if not, this has never been a problem for me.
No, I’m not at all sure about that at all. Thanks for pointing it out. An end date of 1/1 doesn’t make any sense given that Q4 payments aren’t due until mid month. I took out the end dates for the January payments.
(Yes, I got the dates from the payment processor: https://www.pay1040.com/TaxPayerTools/FrequentlyAskedQuestions#question02)
The option for Estimated tax goes away sometime in mid-January (1/15?) In it’s place a new option shows up “extension payment”. I tried to do an Estimated Payment in the 2H of January and that wasn’t an option with any of the payment providers.
excellent article. for the 1st time was thinking of overpaying on my AmEx by $20k, but was wondering how long is usually the turnaround time for overpayment refund? any way to expedite such an overpayment once you realize its taking too long?
Thanks. The turnaround time is completely unpredictable these days. I added a section about how to request your refund if it doesn’t come automatically: https://frequentmiler.com/pay-taxes-via-credit-card/#How_to_request_a_refund_if_it_doesnt_come_automatically
i did an overpayment for tax year 2020. Still waiting for my refund.
Was on a call with IRS in November – they said it’s resolved and I should be getting the refund any day now. We will see.
Not worth it!
You do get around 4% annually on overpayments so consider it as a high yielding savings account.
Vanilla Mastercard gc works on pay1040 today
How long does it take for a $498 Metabank VGC Payment thru ACI to show up on my IRS account page? It doesn’t seem to be immediately.
last year, i had to email ACI to get my two payments to reflect. they replied within one business day and fixed the issue. hope this helps!
I tried paying with a Vanilla VGC purchased from CVS (in California). when I tried paying on PayUSATAx, it says it is not a debit card. It has been activated and shows a balance of $500. It works on official payments and Pay1040
Any idea what is going on, any workaround
Thanks
Raghu
We have had this note in the post for a while:
NOTE: Vanilla Visa gift cards are not recognized as debit cards at PayUSAtax.com.
Thanks for that link noting January 1. Marked my calendar to pay taxes January 1, 2022, to meet a CC min spend. I assume that the last day is through January 1 and not “up until January 1”.
I am planning ahead for 2022 and will need to make $1.7M in estimated payments.
I am thinking of using the Bank of America Premium Rewards card with Platinum Honors Preferred Rewards to gross 2.625% cash back (a bit more since you also earn rewards on the fee).
Does anybody see any problems with this? I am planning on a credit limit >$70k to make it happen.
Does BoA code these as cash advances?
Are other recommendations for cards? I am not looking at chasing sign-up bonuses or limited cash back (up to $X).
That sounds like a good idea to me. Make sure that you qualify for BOA’s Platinum Honors before starting that spend. Also, in order to get more capacity, consider getting all three of these cards:
All three of the above cards will earn 2.625% back. You won’t incur cash advance fees for paying taxes.
I opened a checking account at BoA with $105k last week. I am hoping I “qualify” for Platinum Honors next statement cycle. There is some language about a 3 month average, but that is waived for new accounts.
Unfortunately, I am limited to 2×3=6 transactions per quarter. Therefore, opening other cards won’t help. I can payoff the cards as soon as the transaction posts.
I requested a $100k limit from Citi a couple of months ago. It was initially denied, but when I submitted documentation they approved it. I am not sure if that will help or hurt my case with BoA.
if you put in $300K you can get Platinum status after 1 month. They look at the average of the last 3 months. It would just use $0 balance for the first 2 months then $300K for the last.
There is some verbiage about qualifying if you mee the minimum within the first 30 days, for 1 day. I was not enrolled very quickly. I did reach out and they were unable to enroll me, but did submit a ticket. A few days later I received Platinum Honors. Not sure if it was my call or if it was automatic.
It didn’t appear to be based on the 3 month average, since $125k/3 would have still qualified for something.
I’d put $125K on a Southwest card to qualify for CP and $200K on an AA card to get EXP. That’s an easy way to two very useful airline status
Do one vanilla Mastercards still work?
Simon gift cards do not appear to be working on all 3 sites.
is this still the case?
Not sure as I liquidated another way
Metabank Visa working at ACI as debit. Not working at PayUSATax or Pay1040.
Metabank Visa stopped working at ACI. Sunrise Visa working as debit at PayUSATax (and PayMNTax) and Pay1040.
Which stores carry Sunrise Visa cards?
Metabank Visa worked at ACI as debit today.
Vanilla Visa working as debit at ACI and PayUSATax (did get to try them at Pay1040)
Metabank Visa working as debit at Pay1040.
Metabank Visa worked as debit at all three IRS payment processors today.
Thanks for your updates! I’ve updated the post.
Hey Greg,
My spouse needs to pay EST tax for our jt filing. The amt is not large like some on this thread. Just for the amt of $1250. I have just gotten a new CSP for the 100k points. Can my card be used to pay the taxes even tho I am not the primary filer on the return?
Many thanks!
Yes definitely. There’s no problem with doing that.
I just tried to pay Q3 estimated taxes. Vanilla Visa GC does not code as debit card with PayUSATax. First time using Vanilla Visa as the local grocery store switched to Vanilla Visa(5.95 fee vs 6.95 for MetaBank for a $500 GC) from MetaBank
When I pick Debit, PayUSATax says this is NOT a debit card.
I even reset the PIN for the GC, still no luck
Any ideas
Raghu
That’s strange. I just used a Vanilla Visa GC yesterday at Pay1040.com with no problems and at PayUSATax.com on Aug 7 with no prolbems.
Is anyone able to use PayPal on PayUSATax currently? When I click the PayPal link, it appears to attempt to load a Paypal window, but then it closes immediately. Was hoping to pay via PayPal for the 5% on Discover this quarter
For what it’s worth, I see some errors in the browser developer console. I’ve also tried 3 different browsers on a Mac.
same, i hope they fix this soon
still not working…
Apparently, there’s a number of others who have this issue, in this PayPal thread: https://www.paypal-community.com/t5/Payments/PayPal-payment-pop-up-window-closes/td-p/1583440
Thanks for this update. I haven’t tried to pay with Paypal so I haven’t personally encountered the problem.
I believe I’ve found a work-around to the issue of trying to pay taxes via PayPal on PayUSATax:
Put in valid credit card information first (for any credit card) and then press the PayPal button. When doing it this way, I got the PayPal screen to successfully load.
Please let me know if this works for you!
That worked for me!
so this workaround did work a couple days ago, but I’m trying to make another payment, and the workaround no longer works
I just checked the PayPal discussion forum, and there’s a message indicating this feature is tied to your SSN: https://www.paypal-community.com/t5/Transactions/PayPal-payment-pop-up-window-closes/m-p/2822418/highlight/true#M51062
So I was able to make a payment via PayPal successfully using both mine and My spouse’s SSN, but unable to get PayPal to show up for a 2nd payment. however, if I change the SSN, PayPal does appear. So it looks like you basically have one shot for PayPal per SSN per quarter?
To help with the Data Points, here are the payments I made so far this year:
ACI – Vanilla Visa, MetaBank Mastercard, Walmart Visa
Pay1040 – Vanilla Visa, Walmart Visa, MetaBank Mastercard
PayUSA – MetaBank Visa
Metabank variable MC declined as debit on PayTaxUSA, accepted as debit on ACI
I files my tax via Turbo Tax software. How can I make 2 separate payments with 2 credit cards? Thanks.
Yes, within Turbo Tax simply indicate that you are separately mailing a check to the IRS. Then go through the payment processors to pay by credit card. You don’t need to send it a payment stub even though Turbo Tax will tell you to.
Hey Greg,
“June 15 2021: 2nd quarter 2021 estimated taxes due
(Payable online from 05/15/21 to 07/15/21)”
So.. you can pay the estimated tax after the due date? Thanks
I found that strange too. That came from a payment processor’s website.
i think you can still pay after the due date, but you may need to pay penalty and/or late fee if after the due date.
Simon GCs are working again today on pay1040.com
Awesome. Thanks for letting us know!
Metabank MC: Success on Pay1040, “not a debit card” on payUSATax
When does the IRS refund the overpayment? My 2020 IRS account shows I have a $2000 credit from the overpayment. I filed my taxes in early April. Still waiting for them to refund it. Tax refund status tracker still says in process, refund timing unknown.
Refunds used to be quick, but last year my refund took a long time to come. I don’t know how long it will take this year.
Same situation. IRS issued me partial refund. The amount for extension is not refunded. Online status is still in processing with refund timing unknown.
My situation exactly. Got a partial refund for all the estimated tax after 3 weeks, but not the extension payment.
Kevin, do you have any update? Mine is still waiting.
no still waiting. “refund date will be provided when available”.
still showing code “570 additional account action pending” in the transcript.
Rfclub, what’s your status now? I am still waiting. I called them in November and they said they manually fixed it and need to wait 4-6 weeks for the refund. Frustrating.
H Kevin, still waiting. Last week, the “where’s my refund” website changed to “return received” from the long “still processing” message. Not sure what it means. how long did you hold when you call them?
yes, we are in the exact same situation. Mine went to “return received” in early Dec. Still waiting.
I called 3 times. 1st time wasn’t bad, but the computers were down. Second time the wait was over 90 minutes so I hung up. 3rd time I got through in about 20 minutes.
Call 800-829-1040. Press 1-2-2-3-1 to navigate through the phone tree. when you get through to someone, ask for “Personal Account Management – Refunds”.
Here’s a shortcut that I came across that allowed my long-held refund to be released: call 800-829-0582 x462. Entering that extension brought me to the correct department, and my hold time was about 10 minutes. The guy I spoke to was very helpful, spent 45 minutes working on my situation, and ultimately determining that my refund had been held for 8 months for no legitimate reason. He released it to be paid in a few weeks.
Some of you may benefit from knowing how I got into this mess: TurboTax rounded my payments to the nearest dollar, which meant that it under-reported my payments by $1. (I made numerous payments via credit card). They sent me a letter to which I responded, but they still held my $8,000+ refund for 8 months. Ridiculous. So, if you use TurboTax (which I certainly don’t recommend), I suggest either ensuring your payments are in whole dollars and/or carefully checking to be sure that TurboTax doesn’t do any rounding.
Until I called, I’d been waiting for them to get around to releasing my refund, as if I was in a queue and it would eventually get addressed. I now believe that was a bad assumption, and I think they are putting people on hold and then forgetting about them. So, if your IRS refund is delayed, call them.
Finally after a few more follow up calls I got my refund and $50 in interest. Interestingly, even though I got the original portion of the refund bank in April 2021 as a direct deposit, this time they sent a paper check.
Total wait: 10 months
Total time wasted on the phone: 8 hours.
5/16 DP, Vanilla VGC pay1040 success
Who’s the processor for your Vanilla card? Blackhawk?
I just tried pay1040 again (5/16) with my Simon VGCs and still no luck.
Anyone else have luck with Simon VGCs?
bancorp
Thanks, wonder if Pay1040 is just not accepting Blackhawk processed cards…….
Pay1040 declined my metabank Visa gift card today as well.
Thanks for the additional data point. I’ll have to circle back with Simon to find out if they have more info on what’s going on with Pay1040
Thanks Mike and SteveH. I updated that section of the post and linked to your comments.
Issue persists on 5/22 using Simon VGCs on Pay1040. I resorted to draining two card using the secondary taxpayer’s SSN on ACI.
5/22 DP: Vanilla MCGC payusatax success.
I tried Payments with Visa gift cards in Pay1040.com and PayUSAtax but it shows amesage that is not allowed by the bank. My payments with ACI Payments, Inc. went through. Any ideas?
I have been doing this for years – 2 payments for each processor every quarter with Simon Visa Gift Cards with no problems, besides the one I mentioned above, but that has only to do with the dates I am sure. The errors I am getting specifically say I have reached the limit of 2 payments for the period.
See Mike’s comment about Pay1040 from yesterday.
Greg, you show the dates for when payments are due for each quarter, etc. as follows:
But what is the start date for each quarter? I know it’s not, say, June16 for Q3 as that has not worked before. There must be some days between quarters I think.
For example, I tried to pay via ACI today but it says I have made my maximum contributions for the quarter (I paid on 4/8/21 and 4/14/21 which I thought would have been for Q1 2021. And, of course, it’s impossible to get hold of anyone at these places.
1st Quarter Estimated Taxes 03/01/21 – 05/15/21, 2nd Quarter Estimated Taxes 05/15/21 – 07/15/21, 3rd Quarter Estimated Taxes 07/15/21 – 10/15/21, 4th Quarter Estimated Taxes 10/15/21 – 01/01/22. These are the dates that the online processors will accept the payments but I am not sure if you would get hit by an IRS penalty if you made for example, a 2nd quarter payment after June 15.
Thanks, Jason. It did indeed work yesterday – for Q2. I must have been impatient. I am now saving Pay1040 for my credit card payments and the others for my debit cards.
Thanks. Added dates to top of post.
FYI, tried paying 2020 1040 taxes on Pay1040 with Simon Visa cards, declined on 2 different cards from 2 different purchase batches. Tried wife’s account, also declined on her 2 cards from 2 different purchase batches.
Called Pay1040, told to call issuer. Called Simon, cards working fine, said merchant declined. Suggested trying card processor. Called Blackhawk, cards working fine, said merchant declined. Called Pay1040 back, said they couldn’t help, told to call issuer again.
Used all 4 declined cards on ACI and PayUSATax, all went through and processed.
Something’s up with Pay1040
Real DP:
MGC issued by Metabank, can not go through with pay1040 or PayUSAtax
VGC issued by metabank can not go through with pay1040
Greg or Nick–so if I pay with the freedom unlimited and have the sapphire reserve, I’m then at 2.25% back towards travel right (or effectively 0.29% positive). Thanks!
For anyone that has made 1040 payments (not estimated or extension) and then using Turbotax to file their taxes, how are you inputting your payments? The most appropriate place on the 1040 form seems to be Schedule 3, 12d “Other Payments,” but I can’t figure out how to input a number there using Turbotax. Thanks.
You made payments before filing? I filed and then paid and I didn’t have to input anything.
Yes, I made 1040 over-payments before filing with the idea that I will get them back as a refund. It sounds like you’re talking about filing and then paying what you owe which is different than my situation.
Heads up on something that I hope is just a temporary glitch. Today my Simon Visa GC was rejected by Pay1040.com. I called Simon Customer Service (they were very helpful); they said that the vendor rejected the card, and that the card should work anywhere else. I then tried it on Amazon and it worked. The rep wondered if Pay1040.com might no longer be accepting gift cards, and he’s going to check into that and call me back tomorrow. But thought I’d provide this DP and will update when I heard back.
I just tried with a metabank MasterCard gift card on Pay1040 and got “We are sorry, but we are unable to authorize this transaction. Please verify the card number you provided. To try again with a different card, please select the Edit button.” Tried again and made sure card number was correct but same error message.
just tried a Simon and OneVanilla on pay1040, neither works. Same error message as you.
Did you use Mastercards? I believe that only Visa cards work at Pay1040. Only Mastercards work at OfficialPayments.
both were Visas. I’ve definitely used VGCs at pay1040 in the past without issue.
I used MetaBank MC GCs on 4/16 to pay taxes via Pay1040. No issues. Used VGCs on two different days last week, also worked fine. Don’t have any cards to try now.
+1, just attempted to use a $1000 Simon Visa GC on pay1040.com, but it’s being rejected
I just tried using a Simon Visa GC on pay1040.com this evening, and the payment went through fine.
Will Paying Taxes using the Chase World of Hyatt Credit Card be considered as a cash advance under the NEW Chase “Cash-Like” Transaction Terms?
I’m 99% sure that it’s safe, but I haven’t heard any datapoints since Chase’s new rules kicked in.
Does anyone know when the 2nd quarter officially starts? I thought it would be today (April 16) but PayUSA still tells me I already made my maximum of 2 payments.
I believe it’s around May 15 but check the faq of the website.
I believe that you are correct. I have never understood why the processor cut off dates don’t coincide with the IRS due dates. What is the point in making a first quarter estimated payment after April 15 since it would be considered to be late.
I don’t see anything in the FAQ’s on the dates for estimated payments which is why I came here and asked. But if anyone can find anything in the FAQ’s which has the dates, can you please link to the appropriate FAQ?
I didn’t see the dates on PayUsa website, but here are the dates on Pay1040 website. The dates are likely the same for all processors.
Here is the link. https://www.pay1040.com/TaxPayerTools/FrequentlyAskedQuestions#question02
Thanks.
Thanks. Added dates to top of post.
Uh-oh just paid my taxes with a gc and accidentally fat-fingered my first name. Wish me luck!
Just a note that Metabank MC gift cards are working as debit cards on Pay1040.
Thanks! Updated.
Does Amex frown upon me doing the whole MSR with a tax payment? I have $3k to do on the Delta plat biz I just got, sorta want to get it over with.
No, that should be fine.
Data point on $200 Metabank MC gift cards from Staples:
Does not work at Pay USA
Works at Pay 1040 and ACI
Thanks. Added that as a note
When you say doesn’t work, do you mean doesn’t work as debit or doesn’t work at all? And when you say does work at pay1040 and ACI, does it work as debit?
ACI Payments does not allow Bank of America (maybe all) business cards for payment. I get the message: Commercial cards cannot be used to pay personal federal taxes. Please use a different card or payment method.
That’s interesting. Have you tried it with either of the other processors?
Have not yet but will do so and report back.
@Justin any updates on this? Considering opening up a BoA Business Card for payment.
@Justin any updates on this? Considering opening up a BoA Business Card for payment.
Works for Pay USA. Not able to try Pay1040 yet.
If I use $200 Visa gift cards from Office Depot, can they be combined or do you have to pay the fee per each $200 card?
You have to pay the fee for each card
Any workarounds for paying NYS taxes which charge 2.25% for credit or debit cards?
Possible DP – I used Pay1040 twice in December with a Business Platinum, then again in mid-January using PayUSATax and had no issues. Each of those were estimated payments.
I then used a Resy Gold with PayUSATax about a week ago, and made a standard tax payment, and it apparently shows up in the Amex system as “federal excise tax offset fees” and they are opening an investigation. We’ll see if those points post.
I don’t know if they have changed something or if it is the estimated vs. standard payment or the (Business) Platinum vs. Gold. But something to look for if you’re making payments.
Thanks for sharing this. Please let us know how it turns out.
Just a DP. I have paid MC on Official Payments for the last few months with no problem. Also would like to point out the timelines for each of the payments that are in their FAQ which might be useful to add into the article.
Mostly only useful for Q1 because in Q1 you can make 2 of the following 2020 Estimated Payment (only until early Feb), 2020 Final Payment, 2020 Form 4868 Extension and then get it all back when you file the tax return. And for me paying a little extra gives me peace of mind in case I would have underpaid taxes during the quarter and had to deal with penalties and interest.
Also the quarters for 2 per quarter seem to be based on IRS quarters not financial quarters ( for example Apr-May is one quarter per the IRS) so you have to make sure to time your payments keeping those in mind
I see some of the payment processors still accept 2020 estimated tax payments. Even tho the deadline was 1/15, what’s to stop someone from overpaying on the 1040-es and does it matter? I could do additional payments for my spouse.
My guess is that it would work, but I don’t know for sure
Anyone have had issues with Pay1040 and PayUsaTaxes? I’ve paid estimated taxes for both myself and my dad, but some payments seemed to not have gone through to IRS (called them and they had no record). Trying to reach them but their lines seems alway busy and haven’t gotten any replies when I emailed them.
Yes. I paid $145,000 12/29 and $20,000 Jan 4 and IRS has no record. If this isn’t credited by the end of the month I’ll dispute the charges,
IRS does have the payment made through Official Payments Corp.
Pay1040 is Link2gov which in turn is a sub of global payment provider FIS.
I was told to just wait 2 more weeks but it’s been 19 days.
I’ve emailed the General Counsel of FIS>
IRS is in a major update mode, thanks to the new tax law that was signed finally on December 27. Payments will be delayed to be reflected properly online, I suggest to be patient.
Again, when you inject a third party in dealings with the IRS you run the risk of getting tangled up in a bureaucracy that was already in shambles. Then Covid hit and I pray every day me and my clients don’t get sucked into a dispute with it.
Thanks for the comment. How long woud you wait before disputing.
Their customer support form emails you back a ” message undeliverable.”
you know, ymmv.
I don’t know if the problem is at the third party vendor.
But as far as the IRS goes, here is what happened to me: I made a payment online at the IRS Direct Pay site on January 5 and my bank showed it on January 6. The IRS records still do not reflect it! I am not worried…yet. Because of the notice below seen in my IRS account:
Limited Account Services, Dec. 24, 2020 – Jan. 20, 2021 We’re sorry for the inconvenience. Some services will be down due to planned maintenance. Payments and other account activity between Dec. 24, 2020 and Jan. 20, 2021 will process normally but may take longer than usual to appear online. Please check back on or after Jan. 25, 2021.
I believe that this is just the IRS being very slow to update their records. This has been going on since early in the pandemic. For example, I paid some estimated taxes in June 2020 and by early August the IRS still didn’t see those payments. By late August, the payments appeared and they were back-dated on the IRS website so that it showed that I had paid on time.
I actually paid through PayUsaTaxes back in 01/17/2020, so would expect it to post by now? Anyone have any experience following up with them? Again, I used their form, but no responses. Also, I’ve called and been on hold for 1+ hour twice, but no one ever picks up.
Yikes. That’s a very long time. I don’t have any experience with dealing with that situation.
I have the same issue. The IRS is updating their systems and will be fixed on 1/25. However, you can run your Transcript from their website and see all 2020 activity including payments
Has anyone actually gotten the $25 Amex credit for a $500 or more IRS payment through one of these sites?
Me. Posted 15 January for payments that posted 9 January; but only showed up today (16 January) on the Amex cite.
Would have been nicer if I had known this before 4Q 2020 deadline (last night), but, whatever, I’ll take it.
Anyone have any tips to calling the IRS? After calling and going through many layers of the phone tree, I keep getting the message that they can’t take my call due to volume. So frustrating!
This is why I do not recommend paying your taxes with a credit card via a third party. When things go wrong, you realize how hellish it can be dealing with the IRS.
Wearing my CPA hat
My CPA used to just go to their office and wait but I guess that’s no longer possible?
Yeah, those were the good days dealing with the IRS! Not happening anytime soon, maybe ever, sad!
So I tried to set up the account with the IRS. It says it can’t verify me online (I guess bc my phone is with Visible, which is not a major carrier?). It’s supposed to send me a snail mail thing to verify. I’ve tried multiple times and never got anything. I’m still waiting on most of my 2020 refund, any other ways to set up the IRS account? Last few times I called them the answering service said they weren’t taking any more calls and to try another day (! seriously)
I have a MSR to meet and taxes to pay, but I’m hesitant to leave couple grand in there with no idea when I’ll get it back like last year.
Nick, what happens if you go over the 2 payments limit? I did four different Q4 Estimated tax payments (via 3 different payment vendors). First 2 payments showed up fine. But not the other 2 payments. It’s been about 13 days. So far no refund to the credit card, payment verification still shows payments were made, but not showing up on IRS transcript.
Any help would be greatly appreciated.
The IRS has been very slow to record payments during the pandemic. I’m sure your payments will show up eventually (and they’ll be back-dated to the dates you paid)
thanks Greg. Yap, paid on Jan 1, showed up on IRS transcript on Jan 26. Thank you.
Now I want to apply for a Ink card with 7500 spend. I am thinking just pay as a normal 1040 payment (apparently can’t do ES taxes any more post-Jan 15 deadline, the ES payment option disappeared), then report as “Other Payments via Credit Card” on 1040. So I will have owe less or have a slight refund. You think this will work?
Yep
I made one Estimated payment a few weeks ago using my spouse’s SSN (she files as the secondary) and the payment is not showing up in either of our IRS accounts. I’m guessing that it will be fine when I actually file, but is anyone else experiencing this?
Not sure if this explains what is going on in your case, but I found over this past year that it really can take several weeks for them to post this to their on-line site for your (my) account.
which provider? Let me guess : PaY1040?
Thanks Greg excellent article. If you intentionally overpay your year-end taxes, do you: 1) make your overpayment before filing your taxes, and then report that payment on your tax form (just like your report your quarterly estimated payments), such that your tax form shows you are due a refund? Or do you 2) file your taxes first, then overpay whatever your tax form says you owe? If the second option, what if your tax form already says you are owed a refund? Can you still pay more taxes anyway and just get an even higher refund somehow?
Thanks!
You can do it either way. If you pay more than you reported was paid, the IRS will send you a refund but it may take longer for them to do so.
I made payment to 2020 Estimated Tax via Officialpayments on Dec 26th, 2020. I don’t see it posted to my IRS account on 1/12/2021. Anyone else has the similar experience? Thanks.
The payments made via Official Payments on 9/15/20 and 12/22/20 aren’t showing up for us either. I have called many, many times and after 4 minutes in the phone tree being told they can’t take my call.
ACI is the parent company. Find the name of the General Counsel and write a letter and DISPUTE in the meantime. It’s not enough for the company to say “oh we paid IRS at 12:14pm on 1/4 (5 days after the charge in my case). I’ve got $165,000 that is not reflected as pending or completed in IRS tax transcript.
“They are way behind crediting payments” is nonsense when the payment doesn’t show as pending in the IRS account.
Anyone else having this issue: I just paid my 4th Quarter 2020 Estimated Taxes via PayUSATax.com in two payments (I’m knocking out two minimum spend requirements). I’m 100% sure that I selected Tax Year 2020 on both payments. When I look at my payment history on PayUSATax.com’s website, it shows BOTH payments for the 2021 Tax Year. I’ve been listening to the “We’ll be with you in just a few moments” + on hold music for over an hour trying to get through to a live person to make sure the payments are credited to the correct tax year.
Did you get a hold of them? Same thing just happened to me with payUSATax.com My payment receipt clearly says 2020 estimated tax, so that makes me feel a little better…? I kind of regret not doing Pay1040 like last time since there was no issues, but they raised their fee recently. I might just need to say how the payment post on the IRS account page.
It popped up on my IRS account today as a payment for 2020. No worries. Just a glitch in their computer system. It took a few days to show up on the IRS website, but all is good.
For overpayment refunds, how is the refund made? Back to the cc?
Like any normal tax refund you will have the option of getting a check in the mail (why idk) or getting it DD’d to a bank account (technically you can also get it on a PP debit card but again..why?)
Maybe I missed it, but is there a limit on amount you can pay IRS via one of these companies (by IRS, the processing co, or Credit Card)? I am thinking of $5,000 payment and can either get overage in refund or apply to 2021 taxes.
I paid $25,000 and it wasn’t an issue. I assume they see 10-100x higher than that too.
No, there’s no limit
One word of warning —
It is likely that most of us will get a $2000 stimulus payment with the Democrats in power. The prior two stimulus payments were based on your 2019 taxes (filed in 2020). If you made a lot more in 2020 (some did), do not file your taxes early. It is possible that the government could look at your latest income taxes and reduce or eliminate your stimulus payment due to the higher income.
The last stimulus payment tapered off once you had an income of $75000. And was nothing if you made close to $100,000 or more.
The opposite is also true. If you made a lot less in 2020 than in 2019, it is worth filing taxes asap and maybe you will then qualify to get the fill $2000 stimulus if the government looks at your latest taxes.
In theory in your scenario #2, since these stimulus payments are essentially advance-payment refundable tax credits, you still should get the full amount when you do your 2021 taxes. But yeah, great point that you should file asap to get your full amount up front w/o hassle.
Also to note, it’s $1400 payments this time – to supplement the $600 payments we received in December to equal the $2000 originally proposed by the House.
Great article! Thanks for highlighting the $100 bonus on the Discover card since my card didn’t arrive and Discovered honored the promo.
You may want to highlight Pay1040.com raised its rates since some people who pay their taxes with a credit card for awhile, may not realize that it’s no longer the best site.
Amex also has a promo on the BB+ card, spend 8k get 11.5k points up to 3x. The $500/$25 promo stacks nicely with that promo especially if the person already had spend on the card.
Just to clarify, I need $2k spend on Amex gold for the SUB. I can go to one of the payment processors and pay $2k towards my 4Q 2020 taxes today (January 8) then just get it back next month when I file?
also, do I just log into a payment processor and make a payment or do I need to do something else first or after I pay?
Yes. Yes, just browse to the payment processor and make a payment.
[…] Taxes via Credit Card 2021 Edition: This is a great reference post from The Frequent Miler. I don’t want to think about taxes […]
What about timing of refund. Let’s say I pay on Jan 15th and I file soon after do I get the refund in the normal 2-3 week time frame?
I’ve usually received the refund pretty quickly after filing end of year taxes, but I expect that things will be much slower this year so don’t over pay unless you can float the extra for a few months at least to be safe.
Do you have any advice on paying property taxes to the county tax assessor? I was wondering if any of the methods above will work for paying my property taxes?
My property taxes are payable on the property tax appraiser website w a credit card for a fee.
If you are trying to earn the $25 for a $500 spend on Amex, make sure the actual IRS payment is at least $500 because the IRS payment and the fee are charged as two different transactions.
DP – Made 6 payments above $500 (2 per processor), only got the $25 credit once…
I made multiple payments too and got multiple emails, so I’m not too worried about getting the credits. But Amex does seem slower than usual with this particular offer (and the Home Chef too). I see no reason why it wouldn’t show up, eventually.
Just to clarify…you make 6 estimated payments per qtr and do this by doing 2 each at payUSAtax, pay1040, and ACI Payments?
Yep, and then you can do 6 more for end of year taxes if you want too.
Good to know. Thanks.
If you make excessive quarterly tax payments throughout the year, and then when you do your 1040 you are entitled to a refund (no additional tax due), BUT then you pay end of year taxes anyway to MS, does that create any problems? Since on the 1040 there’s only a place to report report estimated quarterly tax payments. Does the IRS catch that you paid end of year taxes that you didn’t need to pay, and just cut you a refund of that, even though there’s nowhere on the 1040 to indicate that you’re overpaying your end of year taxes? Seems risky if they might not catch this — then you have to call them to say you paid end of year taxes even though your 1040 indicated that you didn’t need to?
I would think that would raise all kinds of red flags. That is supposed to be the amount due calculated on your tax return to be filed.
In my experience they’ll catch the overpayment automatically and refund you the difference, but obviously I can’t guarantee that that will always happen.
Thanks for the input! First time trying this — great article, much appreciated.
Thanks FM for such a great article. I have a question on over-paying taxes so I can get them back when I file my taxes.
I want to use Paypal Key(with Amex as funding option) to pay 10K as estimated Taxes at the end of December 2020. With recent happenings, do you think its a risk or Can i pay directly using Amex(would cost ~187) to be safe?
Unfortunately people have reported that Paypal Key no longer works with tax payments
anyone who made estimated payment for Q3 in early September still hasn’t seen the payment shown up in their IRS account? I did Q3 estimated payment on 9/6/2020, and my IRS account still doesn’t show this today as of 9/27/2020
The problem with this article is that it assumes people will pay based on the bonuses for new applicants or due to the virus and does not list the cards appropriate to offset in a normal situation. The best one would be the Freedom Unlimited card (especially if you have the CSR or the Sapphire card to combine points).
Math is simple. You pay 1.87% but Freedom Unlimited gives you 1.5% back plus 50% bonus when redeeming through Chase travel if combined with CSR. You also get the return on the processing fee too.
Most other cards would not be appropriate, such as the offers mentioned where the limit is $100 or $1000, but offers a good return. Also, if you are meeting a minimum spend, you need to account for the processing fee so the total does not go above the said amount.
I have had no problems using Pay 1040. If most cards do not make sense to use because the return is lower, unless some special promotion (such as a credit card opening promotion), they certainly will not make sense if the fee is more.
If you try to work the system, such as using multiple processors or processing in the other person’s name, etc and not following the rules, it is just asking for trouble.
Do I get a form (similar to 1099, W2, etc) at the end of the year that shows the estimated taxes paid (that I can hand to tax accountant)?
No, you just keep track of your payments yourself and hand that information to your tax accountant.
Alliant Credit Card 2 1/2% cash back works fine.
This is a random shot in the dark, but can anyone explain why I am receiving a $8.29 deposit from the IRS today? I already received my expected state and federal refunds a few weeks ago, and I don’t think refunds are calculated with cents anyway?
I paid ~$5000 on an amex and ~$1000 on visa gift cards (2 transactions).
Anyone’s thoughts would be appreciated.
It is interest on your refund since they were late in paying your refund.
https://www.cnbc.com/2020/06/25/uncle-sam-is-paying-5percent-interest-on-late-tax-refunds-yes-its-taxable.html
Interesting, thanks! Especially with essentially overpaying taxes in July.
If married filing jointly, can you make two estimated payments per spouse per processor using the different social security numbers?
Yep
I did this last year, and everything went fine with my filing, but I did make some calls to the IRS to make sure it would work. The payment sites all warn you to make the payment under the primary taxpayer’s SSN, but I disregarded that and then wanted to see if that would cause me any problems.
The first couple of agents told me that my spouse’s and my own payments went into separate accounts (which is true), so they would need to do some sort of manual transfer after I filed my taxes to combine our payments. However, the third agent I talked to told me that their systems would generally combine payments under 2 separate SSNs when the filing was done as married filing jointly. He said that there may be problems occasionally (your account or filing would be flagged to you as not seeing the payments), and then I’d have to call in and ask for the transfer to be done manually.
So worst case, you probably need to make an extra call to the IRS. In my personal experience, everything went through fine, but it did seem like my return took a few extra days to process in order for me to get my refund compared to the past. I didn’t follow up to see if that was related to the payments under 2 SSNs, but in case you experience delays, that might be a cause. I also filed in early February, so it was before COVID-19 hit here (so I don’t think that was a factor).
I also did this and did not make any calls and it worked fine. My wife and I each made payments under our SSNs separately even though we file jointly and the IRS must have figured it out because we did get the refund expected and within the expected time frame (within a month from filing). The system seems to suggest that they prefer you making payments under one SSN, but it worked fine anyway.
I received letter from IRS today for tax underpayment since I paid the taxes under my spouses account so I was not combined. Seems this is a YMMV since the payments weren’t automatically combined for me. I had to call and wait for 30mins for them to transfer funds to correct account.
Did you indicate married filing jointly for both P1 and P2 payments (reversing who you indicated as the primary taxpayer) or simply submit the payments as if each was filing separately?
@Nick Reyes also curious
Looks like this was mentioned in the main article. To add some detail, I don’t think calling the IRS right away is helpful. You can actually login to your account on the IRS website for both filers, and see if the amount was transferred out of the secondary filers account. It seemed like it takes about 7-10 days. If you still see a balance in the second filers account after a couple weeks, it’s probably a good time to call the IRS to get them to manually transfer the balance to the primary tax payer’s account.
Greg, you may want to update these for using gc:
payusatax.com charges $2.55 fee not $2.58 as noted in #5 liquidate gc.
Mastercard gc $500 does not work. Visa works.
pay1040.com does not recognize gift card as debit.
officialpayments.com works as noted.
Thanks Ed. I’ve updated most of your suggestions, but not yet the pay1040 one. When I last tried (a month ago maybe?), I didn’t have any trouble using a gift card with pay1040. What gift cards have you tried?
I believe I tried with Mastercard gc. It displayed fee calculated based on 1.87%.
I just tested again. MC gc not recognized as debit. Visa works and the fee you have is incorrect. It’s $2.58.
Thanks. Fixed.
Vanilla MCGC worked fine for me in payusatax on 7/23/2020.
But Vanilla MCGC does not work in pay1040 on 8/6/2020, charging fee as credit.
Thank you. I’ve added your datapoints.
Anyone who used Discover via Paypal to pay the tax on PayUSATax can confirm you are getting 5% back?
I’ve tried to pay this way a couple of times on PayUSATax but keep getting an error message on PayUSATax. I hadn’t made any previous 2020 estimated payments via PayUSATax
just pay $1,471.17 wih paypal today. I will update when it posted.
I paid $1500 using Discover via Paypal, but only got 1%.
Thanks Rachael. Just to check, are you sure you signed up for this quarter’s rotating 5% categories?
I made a $1500 payment on my Discover and P2’s discover last week via PayPal, and both are discover accounts show that we’ve maxed out the quarterly cash back at $75.
FYI Metabank MCGC not recognized on PayUSA “Card is not a debit card.”
Having the same issue
So how does the IRS know I want to apply the payments to my current (2019) taxes and not my 2020 estimated taxes? We owe about 3500 in federal taxes this year. Plan to pay $1500 with my discover via PayPal, $1500 on P2 discover/PayPal, then 2 – $500 gift cards (bought at grocery store with CSP when they the store was giving 3x gas points). So how do the payment processes, or the IRS, know if my $1500 if for 2019 or 2020?
When you go to pay online, you have to select whether you’re paying Form 1040 (which is your end of year taxes) or 1040-ES (which is your estimated taxes). The payment processor will then submit it appropriately
It says 2 per processor per calendar quarter.But the quarter clock does ot start on July 1
I have been trying for past 3 or 4 days and both Paytaxusa and pay1040 says , I can make only 2 per calendar quarter. So it is not clear if the clocks starts when YOU made your last payment or Jan1,April1, July1, Oct1
Any ideas?
Unfortunately, I think we are stuck this year with only 2 per processor until July 15 since the government set the same deadline for both Q1 and Q2 this year.
Thank you, I will wait till July 16, the rush is because I did not want my GC to be hacked
I contacted one of the payment processors last year (whichever one is owned by Value Payment Systems (VPS)), and they sent me the calendar they use for quarterly payments. Specifically, you can make two payments in their system in each of these date ranges. These dates are from late 2019, so they may have been updated, and I don’t know what the impact of COVID would’ve been.
Q1: March 15 –May 15
Q2: May 15 – July 15
Q3: July 15 – Oct 15
Q4: Oct 15 – Feb 1
I didn’t actually try my first payment this year until July, but I would’ve thought it you did make a Q1 payment during the listed Q1dates, you should’ve been able to also make Q2 payments?
[…] Pay taxes via credit card 2020 edition […]
Chase BA VISA still has companion voucher for $30K spend in calendar year. Voucher is good for 2 years so I delay reaching the threshold until year’s end. I know BA has high surcharges but for sitting up front, I still find value in it.
Hi Greg/Nick,
Hope you have a wonderful holiday this weekend!
If I charge up to my credit limit on my Delta Amex Biz Platinum card (ahem, “sole proprietorship”), does it affect my personal credit rating?
I paid my personal taxes today on this card and wonder if I should pay off the amount I charged on the same day so that it doesn’t negatively impact my personal credit.
I thought that a biz acct wouldn’t affect my personal credit, but now that I’ve done it, I’m not sure.
??
Thanks!
Rick
You are correct that the business account doesn’t affect your personal credit. There’s no problem with letting the balance sit there until the bill comes due.
Does anyone know if I’ll be able to make 4 payments per processor within the next few days to account for Q1 & Q2 Estimated payments? I’ll do Q1 first and then do Q2 closer to July 15th. I just did a payment with Official Payments, but it didn’t ask to identify the Quarter.
BTW, I tried to pay with Visa Debit card on OP earlier this month and it didn’t work, so thank you for posting that update. 🙂
I guess it really doesn’t matter and they don’t differentiate how you pay Q1/Q2 estimate as both are due 7/15/2020 now. You can claim all your payments you make before 7/15 are for your Q1 estimate, or half of them for Q1 and half for Q2, since you can’t specify if a specific payment is for Q1 or Q2 explicitly.
Well, I guess I’ll find out for sure in a week or so when I try to do my Q2 payments.
I doubt you can find out as technically you can pay Q2 estimate first and Q1 next as both have 7/15 as deadline and you don’t specify which quarter you pay for when making the payments. This means IRS doesn’t know which is which, and all they know is what you pay before 7/15 are for Q1+Q2. That’s why I said it really doesn’t matter.
If nothing else, you could use PayUSATax to use the 5% cash back for the Discover 3rd quarter paypal category. Current credit card fee on that site is 1.96%, so you would be coming out ahead. I came across this as I was on the paypal website trying to figure out how to max that 5% cashback category on my two discover cards, since there’s no way I could spend that much on ebay within 3 months and haven’t figured out how to otherwise maximize that category thru ms.
This has been such a cluster fk for me this year. Simon cards worked brilliantly. Great. Then I had to spend a few days calling the IRS- since I hadn’t entered in that I made payments on my tax return (duh, I owed money, how would I know what to pay?) they froze my refund. Finally got them to release it hopefully it will come now couple months after I paid it. I can pay my PA state taxes with officialpayments….buttt, online it keeps saying that I don’t qualify to make this payment either bc name doesn’t match (it does) or it’s first time paying taxes in PA (it’s not, I used OP last year). I tried calling and it’s on this circular loop of entering my ssn and verifying first 4 letters of last name (I only get 2 letters in before it asks me to enter in soc again). However, still not as crazy as PUA is, count my blessings.
How did you get in touch with the IRS about your refund? I was under the impression most of the offices were closed.
I called them?
Glad it worked for you. In several MS forums and among friends who are tax preparers, there are a lot of complaints right now about refunds being delayed a long time, and it’s apparently difficult to get ahold of people to help.
6 months later! Only got the first part of the refund in September. It’s Jan now, still waiting for the last $500 (I realized I could fund a retirement account more, and had to amend). I *did* get a letter today from the IRS that they owe me interest money. I haven’t seen that check either.
Just a quick warning for anyone looking to do this now (June 2020) – a lot of tax returns, yes even electronically filed ones, are seeing very long processing delays for refunds. Do not overpay by more than you can float right now.
Agreed…submitted mine in early April and just got my refund about 1 week ago…so, nearly 5 months? I was fortunate to be paid interest, however I’m sure that’s taxable for 2020.
I am an individual with no business. Yet to file my personal taxes and I only owe about $900. My return is completed and Ready to file from turbo tax.
I need to make SUB spend on Amex business platinum to cover about $7k
Assume I can make a single $7k payment. Will I have any problem with Amex or IRS?
When will IRS refund over payment? Sometime soon or after filing taxes in 2021?
PayPal is a 5% cash back category for Discover in Q3, and I bet Chase Freedom will be 5X UR for Discover in Q4, so that’s a way to actually pay taxes at a discount with payusatax.com.
[…] a debit card and I haven’t been making any extra liquidation trips. I already used some to pay taxes. That said, I inevitably end up at the grocery store once per week for something, so if I were able […]
Probably worth updating that plastiq fee is going up soon.
Good catch! Fixed.
Do you know if paying taxes would code as “online spending” to BofA?
I don’t know
I will let you know soon 🙂
Does not code as online spending.
Oh bummer. That’s surprising and unfortunate.
Similarly, I found that paying taxes via Plastiq does not count with BOA as travel (but paying mortgage via Plastiq does count as travel)
Government payments are excluded specifically
How about paying it through PayPal? Will that count towards online purchase?
FYI. Official Payments is accepting Visa Gift Cards as of yesterday. I’ve successfully used simon visa gift cards no problem.
Does it accept MGC?
Thanks for posting! Made my 2nd quarter payments today.
Great news! Thanks!
“For this relief much thanks”.
Well normally you can make 2 payments per processor for the Apr 15 and Jun 15 deadlines (to cash out GC), but this year both Federal deadlines are now July 15, and I think they will take only one set of 2 payments each for the 1st and 2nd quarter estimated taxes. Also some states might still have the June 15 deadline for state taxes.
Yes, that’s a good point
Do you figure out if the processor adjust accordingly to meet the July 15 change?
Hey guys, does anyone know if the new 5p bonus category for online spending with the citi prestige will work here ?
If not does it make sense to use the new Hyatt card that gives you 3 qualifying nights For every $5000 you spend plus the $15000 free night.
Prestige 5X: Yes, my guess is that it will work (but it’s just my guess)
Hyatt: Yes, I think that’s a good way to use the offer, especially if you’ll earn enough nights this year to earn valuable milestone rewards. See this post for more: https://frequentmiler.com/hyatts-3-elite-nights-per-5k-spend-deal-or-no-deal/
Thank you for your help and prompt response as aways. I truly enjoy your blog.
With Hyatt I just reached 20 nights and in addition I have booked 2 three night stays with mgm LV each 1 payed night and two free nights (I hope they count as 6) and one 4 night stay in Puerto Rico. That will get me to 30. Paying my taxes will bring me to 40, but from why I can see this is as far as I can go this year. I just used my thankyou points for two business round trips to Hawaii ( using our 7 night Marriott cert) and two Business roundtrips to Vancouver (fairmont whistler) and all that thanks to your research!!! Thank you.
Assuming I reach the 30 night with Hyatt I believe thankyou points makes sense for me.
I’ll start with a $100 prestige payment to see how many points I’ll get.
Thank you again.
I put a small amount on the prestige and just called to check. I get 1X on that transaction. I’ll pay all my taxes with my Hyatt card. From what I can see by the end of the year I’ll have 45-50 nights. Unfortunately sixty is very questionable
Now that we can effectively cash out URs at 1.5cpp and given that traveling this year isn’t really a thing right now, is it better to pay taxes with a Citi DC or a CFU?
The way I see it, DC makes more sense if you’re planning on transferring to miles. Using Greg’s example, $10K in taxes would = 20,374 miles at a cost of $187.
But CFU makes more sense if you’re planning on redeeming as statement credits (effectively getting 2.25% CB) = $229.21 minus the fees = $42.21 net.
Taken together, the true cost of those miles is the $187 financial cost plus the $42.21 opportunity cost of lost profit. That means in truth you’re “buying” 2X miles at 1.125cpp.
Those people with access to a 3% card would be doing even better in terms of the CB and therefore would see an even higher cost to buy those miles.
In any case, in some years, it’s worth buying the miles. But this year I feel like cash is king.
While I can’t guide you on which card to use because as you see it’s a complicated decision, I can give you a recommendation to save a ton of money if you don’t mind an extra step. I posted earlier in the comments about it.
You can buy Simon GC’s for $5 apiece + a processing fee now that they’re doing it online. There’s a sale for 5 more days making the cost to acquire the Simon GC’s very minimal. Buy as many $1,000 denomination cards with whichever card you choose to earn the same amount of points. But these GC’s code as a debit on the tax sites saying you $100’s in fees. Well worth the extra steps + time in my opinion.
I’ve never had luck with those. Online orders always seem to get canceled, plus you’d be capped at $5,000 from those anyway with the remainder going on a CC directly. That $5K would save you $81 in fees at a cost of $25 to acquire. All that work for $56 isn’t worth it to me.
Never heard any reports of Simon GC orders getting cancelled, and not sure who you’re saying has a 5k limit.
$50 for about 15 minutes of time ordering the cards seems pretty good to me! If your time is worth over $200/hr I’m jealous! I’m definitely not there yet.
You can only make 6 total payments. So 5 with GCs and 1 with your CC for the remainder.
And you’re really lucky if you’ve never had an order cancelled. Giftcardmall in particular is a major culprit!
You’re paying that much in taxes?! No wonder $200/hr is nothing to you!
I fell into Trump’s tax cut donut hole. Went from a $6K refund to a $12K debt with no change in income. But I could no longer itemize and lost a lot of the dependent benefits.
This is the first year I’ve ever had to worry about paying.
That seems almost unbelievable. If you lost a lot of dependent benefits, that must mean you have a lot of dependents. Didn’t you pick up any additional child credits? Also, why can you no longer itemize?
Just a small correction in your corrected “Important Due Dates” table at the start of the article– 2nd quarter 2020 estimated taxes are due JULY 15th, 2020.
https://www.irs.gov/faqs/estimated-tax/individuals/individuals-2
No % in payin’ the piper early…{:-)
Fixed. Thanks!
I am confused – is this just for people with 1099’s? what about w2? Should I basically be maxing out withholding ?
This works for everyone who pays federal taxes. Yes, if you want to pay by credit card, then maximizing withholding is the way to go. You can also overpay and get money back.
Ok, so w2 would only want to overpay at the end of the year since they don’t have quarterly taxes due and otherwise would have to be floating that money for the rest of the year
That’s true unless you’re OK with giving the government a long term loan
Hi this is not true for people on salary. My company uses adp for w-4 form , it does not allow zero withholding.
Instead it calculates my witholding based on married/single, expected child credit, expected non wage income etc
So I could not find a way to shift all my tax withholding, if anyone has a clue how to somehow using ADP? (portal.adp.com)
so this is what I did last year and it seems to have worked. I reduced withholding from my employer and my wife’s employer to 0 for federal taxes, and then just paid estimated taxes. I believe for W2, if you do this, you still need to pay your estimated tax liability quarterly, or you will end up paying a penalty at end of year. It’s basically 25% of the taxes you owe per quarter.
I ended up overpaying my taxes last year because I didn’t drop withholding until midway through the year, but because my withholding was too low in the first part of the year (due to some other issues in not calculating it correctly), I actually still ended up paying a penalty.
So this is nice because you can get up to a few percent of the taxes you pay back via withholding. One tip I have is to make sure you set the money aside from each paycheck that you will need to taxes, since your employer is no longer doing that for you.
Also, if needed, to increase the number of payments, I was able to pay separately on each of the sites for both myself and my wife. We file jointly, but the IRS’s systems will combine the payments under each of our names automatically.
I just realized the verbiage around withholding is a little confusing, since normally you specify a number of exemptions. our employers’ payroll systems allowed us to set a specific withholding amount, so I had them both set the amount to 0. It’s easier than trying to figure out how many exemptions you need to ask for.
Glad to hear that you’ve paid separately and they have automatically combined the payments. That’s what I wanted to know. Haven’t finished up my taxes yet, but I made separate payments and was counting on this working (paying separately even though we file jointly). Thanks!
I had to make a couple of calls to the IRS last year to get this info. The first couple of people told me that I would have to call in after filing taxes to get the IRS to manually transfer the funds from my spouse’s account to my own.
The third person I talked to told me that as long as the information in the IRS account and tax return matched, their systems would generally automatically move the payments from my spouse’s account into my own.
When you pay separately under your wife I assume you are putting her as primary. Does your wife’s payment show up on your online tax transcript or hers? So far I only see my payments and the extension payment post under my account.
I wonder the best way to verify this, I tried during 2019 so obviously just filed the return. The IRS account currently only showing the payment records under my SSN, although payment to the spouse have been posted to EFTPS accurately. I guess I have to wait until the 2019 tax to be verify to confirm I don’t owe anything.
>>It’s basically 25% of the taxes you owe per quarter.
Dumb question here. How do u calculate the taxes you owe part. I have been paying taxes here for the past 10ish years but havent paid attention to how the amount is established. Usually the employer and the tax software take care of this for me… clearly I missed out on some points in that route.
Do you just look at last years returns, and if there are no significant changes this year on ur part then add a few percentage for inflation to last years amount owed?
I guess what I am trying to understand is how do u make sure you dont underpay for sure, but overpay by a small amount as the overpayment will be a long term loan..
you just need to pay 110% of the prior-year’s tax liability and you won’t incur any penalty, even if you owe money. e.g. 2018 your tax liability was 50k. 2019, you decide to withhold 0 from your employer. No matter how much more money you make, for tax year 2019 as long as you pay estimated taxes totaling 55k (50k + 10%), you’re safe from penalties
The 110% safe harbor only applies if your prior year’s adjusted gross income was $150,00+. If AGI was under $150,000, the safe harbor for avoiding penalties is 100% of prior year’s tax liability
Another problem with Vanilla VGC. Just bought one from Walgreens early this month and try to pay 1040ES. It failed with officialpayments, and it also failed with payusatax saying that it is not a debit card. Finally, it can only be used at pay1040.
Thank you! I updated the gift card section.
Pay USA tax works with visa GC. Processed two today.
What are the cutoff dates for resetting the 2 estimated tax payment limit per quarter with the due date extensions to July 15?
Good question. I don’t know
Are virtual GC’s ok for this? I have only used physical vgc’s in the past.
They should be OK, but I can’t promise that they’ll show up as debit cards online.
Are debit/gift cards still viable for payments? I’ve just tried it twice and got an error that transaction can’t be processed. I’ve used a vanilla gift card in this instance
I got same error on OfficialPayments which has lowest fee, but processed correctly on other two sites. i’m using visa GC from US bank
Sam here, I called Black Hawk network. They told me official payments is processing this a recurring transaction instead of one tiime. So I emailed official payments and they replied they will process either way
Then will official payments solve this issue?
No , CSR not very helpful. This is the official text I got from their CSR
“Thank you for contacting Official Payments. We are happy to assist you with your inquiry. Our payment will sometimes show up as recurring, depending on the bank, but it is only a one time payment. Unfortunately we do not have the ability to alter this. For assistance with getting the approval you would have to speak to your card issuer for assistance in getting the payment authorized.”
I ran into this exact same issue. I called Black Hawk Network, and read them the email text you received from Official Payments. I was told that the terms and conditions of the VGC does not allow for recurring transactions and so there’s nothing they can do to authorize charge on their end. As such, it looks like the seeming back and forth of VGCs working/not working on Official Payments is a matter of whether Official Payments is processing the charge as recurring or not (and whether the VGC you’re using allows for recurring charges).
Ian
Mastercards work. As they say, don’t fight the fed. Just use MC
Just tried today on OfficialPayments. Would not process. I was able to make a payment back in January but not this time.
I think this issue started March 1
Raghu
I recall that the same problem existed last year and I was unable to use gift cards for a long time. Then somebody posted that it was working again and I was able to make a January payment. I wonder why it goes back & forth from working to not working. Very frustrating. . The two other payment sites do not seem to have this problem.
Thanks everyone. I’ve added a note in the post that OfficialPayments doesn’t seem to be working with gift cards at the moment.
I just made two $498 payments on OfficialPayments using a Mastercard Giftcard.
Thank you! That is the news I’ve been waiting to hear.
Still does not work with VGC. Maybe working for MCGC only.
I can confirm that Mastercard giftcard works. I was able to make $498 payment with a MCGC purchased at Kroger while a VGC also purchased at Kroger did not work. Both cards issued by US Bank.
Thanks! Updated post to indicate that it works for Mastercard only right now.
Just processed 2 payments on Official Payments using MasterCard gift cards.
OfficialPayments worked with metabank visa on March 12th (twice actually), but not working as of June 2020 🙁
I have recently used a Chase United personal mileage plus card to test the card payment and whether it counts towards the initial spend requirement using Pay1040,com. After the charge posted, I was told by a chase representative that it does not count. Does anybody have any experience with Chase United Business Mileage Plus cards and if tax payments count towards the initial spend requirement? Does it matter what payment company you use?
So I received more information today. After reaching a US representative of Chase, they told me that the payment to Pay1040.com does indeed qualify as a purchase that goes towards the initial spend requirement. The first customer service representative was not US based and apparently gave me incorrect information.
Great article. Do you know if I could charge someone else’s federal taxes without causing problems? I’m retired but my adult kids have healthy incomes. As the debit card tactic gets tougher use with AmEx, it occurred to me that maybe I could pay some of their estimated tax bills, get reimbursed by them, and eat the processing fee myself.
I don’t think the IRS cares who pays as long as someone does.
If you are filing Married Joint, can both the ‘taxpayer’ and ‘spouse’ (order on the tax return) each do estimated payments under their individual tax ID numbers and then combine the payments when they file their return for a refund?
I have done this each and every year without issue.
Is it combined to the primary taxpayer’s account automatically? That means you can maximize the process with the lowest fee by 4 ES payment per quarter right?
Technically, it does not combine automatically. They show under each individual’s SSN and you just claim the estimated payments when you file your taxes. But yes, you could maximize your gains by doing 2 ES payments per individual (4 per married couple) per quarter.
Thanks, 2019 is the first time I did this (pay separately under each other’s SSN), so will have to see if I run into any issues. The payments have been showing up accurately under each of our EFTPS account. However, in 2020 where I can see the payment in IRS website (2019 is pending info given I’ve filed my return), I only see mine. Hopefully, both sides will be checked eventually to account for all payments made.
I used the IHG Premier Card which has 4X back for the first year. (I signed up for that offer)
It’s basically buying IHG points for $.0046 plus I got the extra 10,000 point bonus for spend on the card. I’ve been getting more than a cent per point value using the 4th night free award.
In the past, I’ve used my AMEX BBC with Official Payments. Last year, I had a targeted offer for an additional 25K Marriott points for each $25K of spend on one of my Marriott cards up to $100K spend (effectively making the earning 3 Bonvoy points per dollar “like the old days” as long as I spent in exactly $25K increments), so I maxed that out (300K Marriott points for $1,870). This year, I’m considering using two Hilton Surpass cards (mine and my wife’s) that each require $15K spend to get a free weekend night + get 3 Hilton point per dollar spent. So, making a total of $30K of tax payments will cost $561 and will net 90K Hilton points (worth ~$540) plus two free Hilton weekend night certs + Diamond Status for 2020 and 2021. I would rather max out the AMEX BCC $50K 2 points per dollar spend over the course of the year on spend that DOESN’T cost 1.87%; and I can always use my December 2020 estimated payment to finish off whatever spend on the card under $50K remains. Sound reasonable?
Greg – I really appreciate your balanced article. Reading the comments below I can see how paying my taxes quarterly is the best way to go. But I am no where near the level of leveraging(or comfortable yet) my CC for points to do this yet. Many of us who read your blog are still newbies, so reminding us about signing up for a good CC to pay our taxes in April to help cover the spend requirement is really helpful. I know many of your readers are way beyond that, but for me this was great!
Thanks for helping us new to the hobby think of an easy way to get those sign up bonuses.
Does anyone know how to use Plastiq to pay taxes to states that are not supported by their dedicated tax page? Can I add the state’s office of tax and revenue as a payee from the regular Plastiq website? Thanks!
@ Greg — I suspect that all three of these processors are not accepting 1040-ES payments for 2020 right now. I tried to make an 2020 1040-ES payment at Pay1040.com last night and received a message that I should return on March 1, 2020 when they begin accepting these payments. I believe that all three processors will begin accepting these payments on March 1, 2020, so this is likely just temporary (and scheduled, so nothing to be alarmed about).
I was thinking the exact same thing when I first saw Greg’s update. Pretty sure that you are correct.
Thanks. I believe you’re right. I was able to get one of the payment processors on the phone and they confirmed that they’ll start accepting these payments on March 1. I’ve updated the update 🙂
It is worth noting that Navy FCU treats Plastiq payments as NOT qualifying for their minimum spend requirements (MSR).
I didn’t know that. Is this posted online somewhere?
Great post. Question: am I correct that once one start making estimated quarterly tax payments that one must continue to so for every quarter until end of fiscal year? Can one make Q1 payments, skip Q2 and Q3 and then make (or even skip) a final payment in Q4?
I understand the advantage of continue to make estimated quarterly tax payments for the miles/points/cashback rewards, but want to know if skipping would be okay.
My understanding (though I’m not an expert) is that skipping quarterly estimated payments is fine, unless your reason for making estimated payments is to avoid an underpayment penalty. See how Form 2210 calculates the penalty. And even if some amount is needed to avoid penalty, it looks like it should be fine to pay 50% in Q1 and skip Q2, instead of 25% in Q1 & 25% in Q2.
For Plastiq, they have a specific page for paying taxes, but it’s not clear if that qualifies you for their 1% fee promo. I’m about the boop the button to simply pay “Internal Revenue Service”, and get the 1% promo. Has anyone gone this route and confirm that the feds receive everything correctly? Just putting my SSN in the memo field.
Great article. Watch out for AMEX supermarket category. Large grocery chains Ralphs, Albertsons, Vons were not recognized as being in this category last time had card–all the grocers near me. Asked CSR if they are now represented. Replied only way to tell is to spend $95 on the card, go to grocery, see if purchase there gets the benefit in statement. This trap might apply elsewhere in the country.
Does anyone know if OfficialPayments.com is again accepting US Bank prepaid visa gift cards (purchased at Kroger) for payments? I have had recent success with Pay1040.com and PayUSATax with these cards but have not tried at OfficialPayments.com since they started declining them last year.
Worked for me yesterday. Interestingly, I used mine at Officialpayments because the USB Visa no longer seem to work at Kiva. I wonder if the issue is certain ranges of card numbers for some reason? Paypal says the issue is on the US Bank end. How long does it take for these payments to post to IRS? I paid yesterday but on IRS website payment doesn’t show yet
Could you comment on the payment of state/county/city property tax payments? Would these taxes be treated much like estimated taxes as far as the fees and not counted as “cash advance” – in my location, we can pay our property taxes in quarterly payments during the first 6 months of the year.
How long does it typically take for a payment to post to the IRS website?
Once Jan 15 passes, is it still possible to overpay for 2019 taxes to get refunded quickly?
Thank you for reminding me that I can still pay 2019 estimate tax, Greg!
I have some big spending requirement on an Amex card. This method comes at perfect timing: First, as I likely overpay the estimate tax, this fund will come back to me soon in April when I file 2019 tax report, a MS-like loop. Second, Amex becomes more sensitive on what qualifies a legit spending. Buying gift cards could be risky. Amex by no means has excuse to deny this spending. One stone two birds!
Guys, if you have a big spending task now, OVERPAY YOUR 2019 ESTIMATE by Jan 15 (next Wednesday)!!!
Yup real easy file early and get the money back . I think Fed refund was like 14 days last year . I think I have $8k on my United card in 2 weeks need $10k for 65k points deal . I hate GC’s don’t trust them.
CHEERs
Greg, how many times you can pay via OfficialPayments.com in a year? 2, 6, or 8?
12, 2 per quarter, 2 1040 and 2 1040 extension.
Any tips on CA FTB taxes?
https://www.ftb.ca.gov/pay/credit-card.html or Plastiq
Sometimes I use my Amex 2x card but the fee is a higher percentage than Federal.
Firstly, you’re wrong – I love paying (at least Federal) taxes. I get 2.65% back on my BofA Premium card (with Preferred Rewards Platinum Honors) and pay 1.87% making me a profit. State taxes, not so good (sometimes I “buy” AMEX points with my Blue Business card (2x MR points)..
I use my Amex BBP to pay est taxes each quarter since some of my pay is SSDI which I don’t have withholding from…considered having my company not take taxes out at all and pay it all with the BBP, but haven’t bit that bullet yet.
Great Job I tell that to people and it gos right over their head . The gov doesn’t care as long as u pay in the proper quarter .Once in 15 years I paid late $27 fee or whatever .
U can get that spending way u there too .
CHEERs
Bank of America premium Rewards is my go to card for income tax and property tax. I am platinum honors so get 2.625 back every time. My city/school tax charges 2.25% convenience fee and I still come out ahead. I normally pay them a day after my billing date so I get almost 2 months of float.
Be careful. I got charged a cash advance fee for that. And BOA refused to refund the fee.
Do Simon mall $1000 gift cards work? That would help reduce costs
Yes, they are just VISA debit cards and will work like any VISA bank debit card.
frank, did you need to set up a pin on their (visa debit card) website? or last 4 digits of card is pin?
I actually came here to post a comment on this topic.
Since the Simon $1k cards have been out, I’ve been using them to pay my estimated taxes. On OfficialPayments.com, they correctly code as a debit card, so I’m paying $7 ($5 for the card + $2 fee) vs. $18.70 fee on Pay1040.com. Using a 2% card, that’s a $13 profit instead of $1.30 profit. Obviously more work, but if you’re buying 5-10 cards at a time, it’s totally worth it.
Are you saying they don’t code as debit on pay1040.com? How about on payusatax.com?
I haven’t tried as OfficialPayments.com has the lowest debit fee, and $2,000 per quarter is enough for me.
Thanks for sharing. Once the payment made, I would assume, 1040 will have a place to show these estimated payments so to receive the refund. Is that correct? Going to try this first time so want to understand the refund part (key point)
@nmd1308 Yes, of course. My tax prep software asks about payments as part of the interview process, and looking back at my 2018 taxes it filled out a Schedule 5 for payments and landed on Line 17/18 of my 1040.
What card are you using to purchase the Simon GCs?
I tried pay1040.com and it didn’t recognize $500 mastercard gc as debit.
Everybody needs to do what works for them, but I find $500 Visa debits from the supermarket to be more advantageous. I can save $34 or $44 (BCE) per thousand. (nobody is making a profit, just getting a discount on your tax bill) BCE is limited to $6000 per year, but with a few 5% category cards you can do better than the Simon Mall cards and a 2% CC.
I’m so new to this, but can you explain more about $34 or $44? What is BCE?
He’s talking about cash back earnings.
BCE = Blue Cash Everyday (an Amex card that earns 3% back on the first $6K per year spent at US Supermarkets (then 1%). The BCP – or Blue Cash Preferred — earns 6% back on the first $6K (then 1%) but has an annual fee (the BCE does not).
So $1K in Visa Gift Cards at a US Supermarket = $30 cash back on the BCE (3%). I assume he’s getting to $34 or $44 based on fuel points. Kroger often runs 4x fuel points, so every $250 in GCs can get you $1 off per gallon on up to 35 gallons of gas. Then you’re paying more in activation fees (since you’d be buying $100 cards with higher activation fees as a percentage), but the fuel points might make up for it if you have a use for the gas (which is I assume where he’s getting his range).
I don’t think the “$34 or $44 (BCE) per thousand” relies on Fuel Points, because Dave said “$500 Visa debits” which are variable load and don’t earn Fuel Points (as Nick indicates he knows by talking about “buying $100 cards with higher activation fees as a percentage”). I think $44 is on BCP (even though Dave said BCE) and goes like this:
BCP cash back: ($500 + $5.95) * 2 * 6% = $60.71
minus activation fees: $60.71 – ($5.95 * 2) = $48.81
minus redemption fees: $48.81 – ($2.59 * 2) = $43.63
$43.63 rounds to $44
If they worked at OfficialPayments, that would be $44.81.
“$34” would presumably be using a 5% category card as Dave mentioned, as that would be $10.12 less.
Xandy is correct.
Sorry, meant to say BCP, not BCE. Can’t get gas rewards on Visa or M/C gift cards unless you run through some more steps I won’t post here. The M/C gift cards don’t work as well for tax payments in my experience, so Visa it is. On a good month you can get a reduction or elimination in activation fees at Safeway (and sister stores).
has this worked for you recently? I just tried making a payment for the first time this year with an online order of gift cards from Simon mall, but official payments said they couldn’t process the card. I just activated the cards yesterday, and was able to register it this morning on Simon’s site, so perhaps I should give it another day to make sure everything went through fine with the activation/registration.
Elsewhere in the comments we discuss that that site is not working currently.
thanks for enlightening me! I found the discussions elsewhere in the comments now.