Pay taxes via credit card, 2022 edition

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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…

Update 10/28/22 – Updated with warning against using PayPal as the payment method with ACI as the processor (in short, don’t). Added FAQ’s and PayPal 5x deal as well.

Pay taxes via credit card

Important due dates

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

Future Deals

  • TBD

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
The Platinum Card® from American Express
150K points
150K after $6K spend in 6 months. Terms apply.

$695 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: Resy Offer: 100K after $6K spend in 6 months plus 10x dining for 6 months on up to $25K spend. Terms apply.

Recent better offer: 125K after $6K in the first 6 months + 15x when you Shop Small in the US and at restaurants worldwide on up to $25K in eligible purchases in the first 6 months [Expired 1/20/22]

The Platinum Card® from American Express Exclusively for Morgan Stanley
125K points
125K after $6K spend in first 6 months. Terms apply. (Rates & Fees)

$695 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Recent better offer: 100K points + 10x when you Shop Small in the US & at restaurants worldwide [Expired 1/20/22]

American Express® Gold Card
90K points
90K points after $4K in purchases in the first 6 months. Terms apply. (Rates & Fees)

$250 Annual Fee

Citi Premier Card
80K points
80K points after $4K spend in the first 3 months

$95 Annual Fee

Recent better offer: None. This matches the best offer we've ever seen.

Capital One Venture Rewards Credit Card
75K Miles
Earn 75,000 bonus miles after $4K spend in 3 months

$95 Annual Fee

Recent better offer: 100K: 50K after $3K in the first 3 months + 20K after $20K in the first 6 months [Expired 7/19/21]

Capital One Venture X Rewards Credit Card
75K Miles
Earn 75,000 bonus miles after $4K spend in 3 months

$395 Annual Fee

Recent better offer: Expired 3/14/22: 100K after $10K spend in 6 months + $200 credit for vacation rental spend in first year

Chase Southwest Airlines Rapid Rewards® Plus Card
75K Points
Earn 75K bonus points after $3K spend in 3 months

$69 Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: Expired 12/9/21: 100K (50K after $2K spend in 3 months plus 50K after a total of $12K spend in 12 months)

Southwest Rapid Rewards® Priority Credit Card
75K Points
Earn 75K bonus points after $3K spend in 3 months

$149 Annual Fee

This card is known to be subject to Chase's 5/24 rule.

Recent better offer: Expired 12/9/21: 100K (50K after $2K spend in 3 months plus 50K after a total of $12K spend in 12 months)

Chase Southwest Airlines Rapid Rewards Premier Credit Card
75K Points
Earn 75K bonus points after $3K spend in 3 months

$99 Annual Fee

This card is known to be subject to Chase's 5/24 rule.

Recent better offer: Expired 12/9/21: 100K (50K after $2K spend in 3 months plus 50K after a total of $12K spend in 12 months)

Chase Freedom Flex
20K points + 5X grocery + 15 months 0% APR
Earn 20,000 points (worth $200 cash back) after spending $500 in the first 3 months + 5x Ultimate Rewards points on grocery purchases for 1st year (on up to $12K in purchases). 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 15.74% - 24.49%.

No Annual Fee

Be sure to select the card you want after clicking through. This card is subject to Chase's 5/24 rule (click here for details). Even though this card is marketed as a cash back card, it actually earns Ultimate Rewards points which are redeemable for 1 cent each, or can be combined with other Ultimate Rewards-earning cards to get even more value. This product is available to you if you do not have this card and have not received a new cardmember bonus for this card in the past 24 months.

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: Referral Offer:Earn 20,000 points (worth $200 cash back) after spending $500 in the first 3 months + 5x Ultimate Rewards points (worth 5% cash back) on gas purchases for 1st year (on up to $6K in purchases)

Recent better offer: 20K points + 5x grocery stores for the first year on up to $12K in qualifying purchases

Chase Freedom Unlimited
20K points + 5X grocery + 15 months 0% APR
Earn 20,000 points (worth $200 cash back) after spending $500 in the first 3 months + 5x Ultimate Rewards points on grocery purchases for 1st year (on up to $12K in purchases). 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 15.74% - 24.49%.

No Annual Fee

This card is subject to Chase's 5/24 rule (click here for details). Even though this card is marketed as a cash back card, it actually earns Ultimate Rewards points which are redeemable for 1 cent each, or can be combined with other Ultimate Rewards-earning cards to get even more value. This product is available to you if you do not have this card and have not received a new cardmember bonus for this card in the past 24 months.

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: Referral Offer:Earn 20,000 points (worth $200 cash back) after spending $500 in the first 3 months + 5x Ultimate Rewards points (worth 5% cash back) on gas purchases for 1st year (on up to $6K in purchases)

UBS Visa Infinite
Up to 100K points (call to apply)
50K after $10K spend in 3 months + 50K after paying 2nd year annual fee

No Annual Fee First Year, Then $495

Chase United℠ Explorer Card
Up to 70K miles
Up to 70K miles: 60K after $3K spend in 3 months plus 10K after $6K total spend in first 6 months.

No Annual Fee First Year, Then $95

Marriott Bonvoy Boundless® Credit Card
3 Free Night Awards
Earn 3 Free Night Awards (each night valued up to 50K points) after $3K spend in 3 months

$95 Annual Fee

Chase Sapphire Preferred® Card
60K points
60K after $4K spend in 3 months

$95 Annual Fee

A similar offer with the first year annual fee waived may be found in-branch. YMMV.

Recent better offer: 100K after $4K in purchases in the first 3 months

Delta SkyMiles® Gold Credit Card from American Express
65K miles
Limited Time Offer - 65K miles after $2K spend in 3 months. Expires 11/9/22. Terms apply. (Rates & Fees)

No Annual Fee First Year, Then $99

American Express® Green Card
50K Points + up to $150 back
50K after $2K spend in first 6 months plus 20% back as a statement credit on restaurant purchases worldwide for the first 12 months up to $150 back. Terms apply. See Rates & Fees

$150 Annual Fee

Chase World of Hyatt Credit Card
45K points
Up to 45K: 30K after $3K spend plus 1 extra point per dollar for non-bonused spend, up to $15K spend in 6 months.

$95 Annual Fee

Chase IHG® Rewards Premier Credit Card
140K Points
140K points after $3K spend in 3 months

$99 Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: None. This is the best we've seen.

Alaska Airlines Visa Signature
62K miles + Companion Fare
62K miles + Companion Fare ($99 fare + taxes) after $3K spend in 3 months

$75 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Recent better offer: Up to 67K miles: 42K miles + Companion Fare ($99 + taxes) after $2K spend in 3 months + 25K miles after $8K total purchases in first 6 months [Expired during 2021]

Marriott Bonvoy Brilliant™ American Express® Card
150K Points
Limited-time Offer - 150K points after $5K in the first 3 months. Terms apply. (Rates & Fees)

$650 Annual Fee

Recent better offer: 100K + 1 free night award after $5K spend in 3 months [Expired 5/18/22]

Delta SkyMiles® Platinum Credit Card from American Express
80K miles
80K miles after $4K spend in 3 months. Terms apply. (Rates & Fees)

$250 Annual Fee

Marriott Bonvoy Bevy™ American Express Card
125K Points
125K points after $4K spend in 3 months

$250 Annual Fee

Chase Aer Lingus Visa Signature® Card
Up to 100K Avios
75K Avios after $5K spend in 3 months + 25K Avios after total of $20K spend in 12 months

$95 Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: Expired 7/4/22: 100K after $5K spend

Chase British Airways Visa Signature® Card
Up to 100K Avios
75K Avios after $5K spend in 3 months + 25K Avios after total of $20K spend in 12 months

$95 Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: Expired 7/4/22: 100K after $5K spend

Chase Iberia Visa Signature® Card
Up to 100K Avios
75K Avios after $5K spend in 3 months + 25K Avios after total of $20K spend in 12 months

$95 Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: Expired 7/4/22: 100K after $5K spend

U.S. Bank Altitude Reserve Visa Infinite Card
50K points
50K after $4.5K spend in 90 days

$400 Annual Fee

Chase Sapphire Reserve Card
60K Points
60K after $4K spend in 3 months

$550 Annual Fee

Recent better offer: Expired 12/1/22: 80K after $4K spend

Air France KLM World Elite Mastercard
50K miles + 60XP points
50K miles after $2K in the first 90 days + 60XP points upon approval

$89 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: Going through the steps to make a dummy booking at the Air France website may result in an offer that also includes a $100 statement credit.

Delta SkyMiles® Reserve Credit Card from American Express
95K Miles
95K Miles after $6K spend in 6 months. Terms apply. (Rates & Fees)

$550 Annual Fee

Recent better offer: 80K miles + 20K MQMs after $5K spend in the first 3 months + up to $200 statement credit for purchases at select US furnishings stores in first 3 months. [Expired 5/5/21]

U.S. BANK ALTITUDE® CONNECT VISA SIGNATURE® CARD
50K points
50K after $2K spend in 120 days

No Annual Fee First Year, Then $95

Chase IHG® Rewards Traveler Credit Card
80K Points
80K Points after $2K spend in 3 months

No Annual Fee

Click here to view details about a similar card: IHG Rewards Club Premier

Recent better offer: 120K after $2K spend (expired 7/4/22)

Barclays JetBlue Plus Mastercard
40K Miles
40K miles after $1K spend and payment of the annual fee in 90 days

$99 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: You could get a 50K offer using an employee code. Details here.

Recent better offer: Expired 2/4/21: 100K after $6K spend

United Gateway Card
30K Miles
30K miles after $1K spend in first 3 months

No Annual Fee

This card is subject to Chase's 5/24 rule (click here for details).

Recent better offer: Expired 8/11/22: 30K after $1K spend

Hotels.com Rewards Visa Credit Card
Up to $375 in reward nights
Get two reward nights worth $125 each when you spend $1,000 on purchases in the first 3 months. Get another reward night after $4K spend in 6 months. Excludes taxes and fees. If your reward night costs less than $125, you won't get the difference.

No Annual Fee

Citi Double Cash Card
$200 Cash Back
$200 cash back after $1.5K spend in first 6 months.

No Annual Fee

Recent better offer: None. This is the best we've seen.

Capital One VentureOne Rewards Credit Card
20K miles
Earn a bonus of 20K after $500 spend in 3 months from account opening

No Annual Fee

Alternate offer: Some people are targeted for a 40K offer. See this post for more detail.

Citi Rewards+ Card
20K points
20K points after $1.5K spend in 3 months

No Annual Fee

Citi Custom Cash Card
20K Points
20K points after $1500 spend in the first 6 months

No Annual Fee

Recent better offer: Expired 9/13/22 - 20,000 points after $750 spend in first 3 months

Korean Air SKYPASS Visa issued by US Bank
30K miles
30K miles after $3K spend in 90 days

$95 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Recent better offer: 40K after $2.5K spend targeted (last reported 2/26/2016)

30K: 15K after first purchase + 15K after $2k spend in 90 days

25K: 15K after first purchase, 10K after $2K spend in first 3 months (expired 1/18)

Capital One Quicksilver
$200 Cash Back
One time bonus: $200 after $500 spend in 3 months from account opening

No Annual Fee

Capital One SavorOne Cash Rewards Credit Card
$200 Cash Back
One time bonus: $200 after $500 spend in 3 months from account opening

No Annual Fee

U.S. Bank Cash+®
$200 Cash Back
$200 after $1000 spend in 120 days

No Annual Fee

American Airlines AAdvantage MileUp Card
10K miles + $50
Earn 10K AA miles + $50 statement credit after $500 spend in 3 months

No Annual Fee

The Amex EveryDay® Preferred Credit Card from American Express
15K Points
15K after $1K spend in 3 months. Terms apply.

$95 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: Some people click through and find that they are targeted for an offer of 30K points after $2K spend in 3 months.

Recent better offer: 30K after $2K in first 3 months

Discover it® for Students
$50 + First Year Double + $20/year
Get $50 after first purchase. All cashback earned in first 12 months will be doubled including 5% earned in rotating categories. Plus, get $20 cash back each school year your GPA is 3.0 or higher for up to the next 5 years.

No Annual Fee

Delta SkyMiles® Blue Credit Card from American Express
Discover it Miles - Double Miles your first year
$100 + First Year Double
Get $100 after first purchase. All "miles" earned in first 12 months will be doubled. This makes this a 3% cash back card for the first year.

No Annual Fee

Verizon Visa Card
$100 in Verizon credit
Up to $100 in credit applied over 24 monthly wireless bills

No Annual Fee

Chase Slate Edge
$100 Cash Back
Earn $100 statement credit after $500 in purchases in first 6 months. 0% Intro APR for 18 months from account opening on purchases and balance transfers. A variable APR of 15.24% - 23.99% on balance transfers and purchases after the introductory period ends.

No Annual Fee

This card is subject to Chase's 5/24 rule (click here for details). Even though this card is marketed as a cash back card, it actually earns Ultimate Rewards points which are redeemable for 1 cent each, or can be combined with other Ultimate Rewards-earning cards to get even more value. This product is available to you if you do not have this card and have not received a new cardmember bonus for this card in the past 24 months.

Allegiant World Mastercard® Credit Card
15K miles
15K after $1K in first 90 days

$59 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Alternate offer: You may be targeted for an offer including a $100 statement credit during a dummy booking.

BBVA
ClearPoints Credit Card
$100 statement credit
$100 statement credit after $1.5K in first 90 days. Note: This card is not available online without an invitation code. You may need to first open a checking account and then apply by phone or apply in-branch.

No Annual Fee

Discover it®
$50 + First Year Double
Get $50 after first purchase. All cashback earned in first 12 months will be doubled including 5% earned in rotating categories.

No Annual Fee

Blue Cash Preferred® Card from American Express
$250 back
$250 cash back as a statement credit after $3K in the first 6 months. Terms Apply. (Rates & Fees)

$95 Annual Fee

Info about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy.

Recent better offer: Up to $350: 10% cash back on purchases at U.S. Restaurants in the first 6 months, up to $200 back. Plus, earn $150 back after $1K spend in 3 months. (Expired 5/3/17)

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
    Citi Double Cash Card
    $200 Cash Back
    $200 cash back after $1.5K spend in first 6 months.

    No Annual Fee

    Recent better offer: None. This is the best we've seen.

    FM Mini Review: 2X rewards for all spend with no annual fee makes this card a winner. Earn 2X everywhere and redeem for the equivalent of 2% cash back or 2X ThankYou points. Pair with the Premier or Prestige card to make points transferrable to airlines.


    Card Type: Mastercard World Elite

    Base

    Earning rate: 2% cash back everywhere (1% cash back for each purchase + 1% when paying your credit card bill for that purchase)

    Noteworthy perks: 1X when you make a purchase + 1X when you pay for those purchases

    See also: Citi ThankYou Rewards Complete Guide

  • 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
    The Blue Business® Plus Credit Card from American Express
    15K points
    15K after $3K spend in 3 months. Terms apply. (Rates & Fees)

    No Annual Fee

    Alternate offer: Some people have been targeted for an offer in their online account for 75K points after $15K in purchases in their first 12 months.

    Recent better offer: 20K after $3K spend in 3 months (Expired 6/21/17)

    FM Mini Review: 2X rewards for all spend (up to $50K per year) with no annual fee makes this card a winner.


    Card Type: Amex Credit Card

    Base

    Earning rate: 2X Membership Rewards points on all purchases, up to $50K spend per calendar year (then 1X thereafter). Terms apply. (Rates & Fees)

  • 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
    Capital One Venture Rewards Credit Card
    75K Miles
    Earn 75,000 bonus miles after $4K spend in 3 months

    $95 Annual Fee

    Recent better offer: 100K: 50K after $3K in the first 3 months + 20K after $20K in the first 6 months [Expired 7/19/21]

    FM Mini Review: This card earns 2 "miles" per dollar, which are worth exactly 1 cent each toward travel. This makes the return on spend similar to a 2% cash back card (though in this case you must redeem your miles to offset travel in order to get 1 cent per mile). One big advantage over cash back: Capital One allows transfering their "miles" to airline miles & hotel points.


    Card Type: Visa Signature

    Base
    Travel
    Other

    Earning rate: 2X everywhere ⚬ 5X on hotels and rental cars booked via Capital One Travel

    Noteworthy perks: Receive up to $100 application fee credit for Global Entry or TSA PreCheck® ⚬ Redeem miles for travel at value of 1 cent per mile ⚬ Convert "miles" to airline miles & hotel points ⚬ No foreign transaction fees ⚬ 2 complimentary visits per year to Capital One or Plaza Premium Lounges

    Capital One Venture X Rewards Credit Card
    75K Miles
    Earn 75,000 bonus miles after $4K spend in 3 months

    $395 Annual Fee

    Recent better offer: Expired 3/14/22: 100K after $10K spend in 6 months + $200 credit for vacation rental spend in first year

    FM Mini Review: This card offers annual rebates that easily mitigate the fee for those who travel often and could be worth it for the lounge access and travel protections given the cost/benefit ratio. Authorized users are free and also get access to perks like Priority Pass, Capital One Lounges, Plaza Premium lounges, and Hertz President's Circle status. The card earns 2 "miles" per dollar on most purchases just like the Capital One Venture Rewards card, which are worth exactly 1 cent each toward travel. This makes the return on most spend similar to a 2% cash back card (though in this case you must redeem your miles to offset travel in order to get 1 cent per mile). One big advantage over cash back: Capital One allows transfering their "miles" to airline miles & hotel points.


    Card Type: Visa Infinite

    Base
    Travel
    Other

    Earning rate: 10X on hotels and rental cars booked via Capital One Travel ⚬ 5x on flights booked via Capital One travel. ⚬ 2X everywhere else.

    Noteworthy perks: Up to $300 in statement credits annually for bookings made through Capital One Travel ⚬ 10,000 bonus miles each year starting at first anniversary ⚬ Receive up to $100 application fee credit for Global Entry or TSA PreCheck® ⚬ Priority Pass Select lounge access ⚬ Plaza Premium lounge access ⚬ Cell phone insurance ⚬ Trip delay / cancellation insurance ⚬ Primary CDW coverage Redeem miles for travel at value of 1 cent per mile ⚬ Convert "miles" to airline miles & hotel points ⚬ No foreign transaction fees

    Capital One Spark Miles for Business
    50K Miles
    Earn a one-time bonus of 50,000 miles once you spend $4,500 on purchases within the first 3 months from account opening

    No Annual Fee First Year, Then $95

    Note: Most Capital One Business credit cards (including this one) DO count against Chase's 5/24 Rule

    Recent better offer: Earn up to 200K "miles": 50K after $5K spend in the first 3 months from account opening and an additional 150K after $50K spend in the first 6 months from account opening [Expired 1/27/20 and breifly available in 2021]

    FM Mini Review: This card is similar to the Spark Cash Plus card, but it has the advantage that "miles" earned with this card can be transferred to a large number of airline & hotel programs.


    Card Type: Mastercard

    Base
    Travel

    Earning rate: 2X everywhere ⚬ Earn 5X miles on hotel and rental car
    bookings through Capital One Travel

    Noteworthy perks: Redeem miles for travel at value of 1 cent per mile ⚬ Convert "miles" to airline miles & hotel points ⚬ No foreign transaction fees ⚬ Fee credit for either $85 TSA Pre✓® application fee or $100 Global Entry application fee

Cards that offer 1.5X points or airline miles per dollar:

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:

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.

See also: Best options for buying Visa and MasterCard gift cards.

How to pay taxes via credit card: Key Information

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.

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.

Pay with Paypal

Update 10/28/22 – Doctor of Credit reports that using AIC to pay federal tax payments with Paypal as the payment method are triggering a cash advance fee. Oddly enough, although the tax payment itself is not be considered a cash advance, the fee charged by ACI is erroneously appearing as a cash advance, triggering a cash advance fee and interest immediately. This may be temporary, but in the meantime, best to steer clear of this method.

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.

Frequently Asked Questions (FAQ)

Will I be charged a cash advance fee when paying taxes with a credit card?

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.

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.

How can I see my tax payment history 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.

When should I report estimated tax 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 should I 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 I over-pay my 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 do I 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 I 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.

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Pat N

I was hit with the $10 Cash Advance fee for my September payment. I had never used ACI before but i decided to try it for the slightly lower fee. I saw the $10 extra charge when I got my statement and I was annoyed, but it was to small for me to worry about, I thought it was just their policy and I wouldn’t use them again.

Today I got an e-mail from Paypal apologizing for the erroneous charge (even though it wasn’t they who charged it). and they said they will credit the $10 back to my account.

Wil

Anyone tried to pay tax through Paypal on ACI or PayUSA in the last week or so? Did you get charged the cash advance fee? Thanks.

Ryan

Anyone else not have their payment code 5x for Chase Freedom family but the separate fee did code with 5x?

Mike

BofA offering 2x extra points on Nov 5th this year. 3x Alaska miles is a good deal here.

milesonmiles

I have property taxes coming up in a few days. If I were to put them on a credit card with welcome bonus (say chase ink cash or personal Amex platinum), will they count as part of the minimum spend? I saw some individuals discussing here that some did not have success with paying federal taxes, so curious what everyone’s experiences are with property taxes for those two cards?

Cavedweller

Works Perfect for Me on Min spend or debit my checking so I Don’t have to Go ..Just got the WH discount @ 65 last year then 6% for this year..Debit is no fee CC I THINK 2%..

Cavedweller

Perfect way to meet the Min spend on any new card. Prepay any bill then put every spend on the card. After 2.5 months pay some Taxes as Done u get the points $$$$.
A Zillion times as in Simple to do…
CHEERs

Last edited 1 month ago by Cavedweller
Cavedweller

I filed late like a month ago and I got Fed in 3 weeks just like when I filed on time. No state refund yet but usually 4 weeks+..
CHEERs

Jerry Love

Greg, I have tried, with no success, to ascertain why the two processors charge their credit-card rate on business debit cards (Nearside is a business debit card).
I would like to understand the argument of the two processors as to why they feel justified in doing this. Do merchants get charged a higher interchange fee for business debit cards versus consumer debit cards? If so that would be a somewhat acceptable answer.
In any case, these three processors struck a contractual deal with the IRS to collect and remit these payments. If that deal calls for the processors to accept all debit cards at their advertised rate they are in violation. Obviously none of us knows the terms of the deal, and good luck getting anyone at the IRS to explain or even appreciate this issue.
I’ve complained to the National Consumer Affairs Department and received no response

It is maybe more important than most people appreciate. For those who need to make large payments, each $20,000 payment results in >$400 savings when using a 2%+ card such as Nearside. Thats’s $3,200+ of potential cashback each quarter (8 payments for a married couple) that is not able to be utilized due to the restriction by the two processors.

Do you have any ideas as to who to contact? You have more of a voice than most of us. Please, lead the charge in finding out if the processors are justified in treating these debit cards differently. Many of us would be grateful.

Thank you

DSK

Two other ideas not mentioned by Greg that I haven’t tried yet so no idea if or how well they will work:

(1) If I pay up to $5000 of estimated taxes (including fees) on the first of each month (other than February) on Bilt, I will earn 2x Hyatt points (which beats 1x on the Hyatt card and 1.5x on Freedom Unlimited).

(2) I think the new AMEX debit card will earn 0.5 Membership Rewards points per dollar and the maximum transaction can be up to $5000. So, I would earn 2500 MR points at a cost of $2.20 per transaction, as opposed to 7500 Ultimate Rewards points (or 10,000 Cap One points or 10,000 Thank You points) at a cost of $93.50 per transaction. Depending on how you value points vs. cash or the different currencies, the debit card could come out ahead.

DSK

Data point–used ACI with Paypal on my Freedom card on October 19. No cash advance fee–everything posted as normal. Read over DofC after I saw this post, and it sounds like it is kind of a mess out there as far as whether payments will be treated as a cash advance or not (some had the same experience as I did–others were coded as a cash advance). Also I did receive 5x points. However, now that I’ve done it once, having seen other people’s experiences, I’m not sure I’d do it again.

rj123456

If you pay via Paypal on PayUSATax with the Paypal MC do you get 3% back?

rj123456

Strike that, meant to say 1%, and to see if it made sense to pay taxes with it. On a 10K tax payment the rewards are $100 less the flat debit card fee. Better than the $0 I get for eCheck payment. Or am I missing something.

Sa ar

Has anyone tried making two estimated tax payments for processor, total 6 payments, for Q4 2022? For some reason Pay1040 and ACI are telling me I have exceeded the number of payments allowed by IRS even though I haven’t done any Q4 payments yet.

Frank

I believe the ability to make Q4 payments begins October 15. So, it is probably telling you that you’ve already reached the max for Q3.

Sa ar

That would explain it. Although I do not see this information posted anywhere official. Thank you

Frank

See above – in the article under “Important Due Dates”.

Sa ar

I see it. Do you know what is the source of that information? Why isn’t this mentioned on the IRS website or the processors websites?

Jason Smith

https://www.pay1040.com/TaxPayerTools/FrequentlyAskedQuestions

Under FAQ # 2

What federal tax payments can be paid through Pay1040 and when?Pay1040 accepts the following federal tax payments:
Personal:

  • Form 1040 Current Tax Return Year – Tax Year 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Current Tax Return Year Notice – Tax Year 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Prior Tax Return Years – 2002 – 2020: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Installment Agreement – Tax Years 2002 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Proposed Tax Assessment/ CP2000/CP2501/CP3219A – Tax Years 2019 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Section 965 Transition Tax – Current Tax Year 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Section 965 Transition Tax – Prior Tax Years 2019 – 2020: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Section 965 Transferee Liability Tax – Current Tax Year 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Section 965 Transferee Liability Tax – Prior Tax Years 2019 – 2020: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Section 965 Transferee Liability Tax – Future Tax Years 2022 – 2023: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040X Amended Return – Tax Years 2019 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 4868 Automatic Extension of Time to File – Tax Year 2021: 01/01/22 – 04/19/22, 7 AM ET
  • Form 1040ES Estimated Tax – Tax Year 2021: 01/01/22 – 02/01/22, 7 AM ET
  • Form 1040ES Estimated Tax – Tax Year 2022: 1st Quarter 03/01/22 – 05/15/22, 2nd Quarter 05/15/22 – 07/15/22, 3rd Quarter 07/15/22 – 10/15/22, 4th Quarter 10/15/22 – 01/01/23, 7 AM ET
  • Form 5329-Retirement Plans – Tax Year 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Trust Fund Recovery Penalty Payment – Tax Years 2002 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Trust Fund Recovery Penalty Installment Agreement – Tax Years 2002 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Health Care (Form 1040) Amended or Adjusted Return – Tax Years 2017 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Health Care (Form 1040) Proposed Tax Assessment/ CP2000/CP2501/CP3219A – Tax Years 2019 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Health Care (Form 1040) Balance Due Notice – Tax Years 2017 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Series Partner Pymnt for BBA Modification – Tax Years 2017 – 2021: 01/01/22 – 01/01/23, 7 AM ET
  • Form 1040 Series PrePayment on BBA AAR/Exam Push Out – Tax Years 2020 – 2022: 01/01/22 – 01/01/23, 7 AM ET
Kent

Regarding using PayPal with PayUSATax and getting the disappearing PayPal wintdow:

I tried the “first enter a valid credit card” method mentioned in the post above with both Chromium and Firefox. Didn’t work.

I tried the “future scheduled payment” method in the comments below. Didn’t work. (I also tried creating a new account – didn’t help.)

I tried a combination of the two methods and was finally able to get the PayPal window to appear. “Great!”, I thought. And I was able to schedule a payment. HOWEVER, I then reviewed my scheduled payments, and it showed that the credit card I had entered to trigged the PayPal window was the payment method that was going to be charged.

I finally got it to work by doing something like the following (you may have to play around, like I did):

  • Create future scheduled payment
  • Enter valid credit card
  • Enter the payment date (at least one day in the future) — and click ADD (the “future payment” method in the comments says not to do this, but this is what worked for me)
  • Click PayPal: Select payment card and agree, goes back to PayUSATax
  • It will still show the credit card you entered. Change the payment type from “credit card” back to “select payment type”.
  • (Here’s why my memory gets foggy.)
  • You can’t continue so you need to re-enter the card number
  • Do the PayPal button again

Strangely, this brought me to a confirmation screen which had PayPal selected as the payment type, and the correct amount, for an IMMEDIATE payment (I guess the future selected date got tossed out). I submitted and it actually charged my Discover card via PayPal, so ultimately it was a success.

Good luck.

Cindy

how do you “create future scheduled payment?”

Cindy

NM. I figured it out. You have to create an account first. Then I went to create a future payment, but didn’t actually click “add”. Then I just clicking back and forth between “credit card”, and entering CC info, and changing back to PayPal multiple times like you suggested, and it worked. Thanks

Last edited 1 month ago by Cindy
Frank

Adding a DP: I’ve purchased over $70K of Simon Mall Visa GC over the past 15 months, all the “Black Sparkle” type, and I’ve used them exclusively for paying taxes. I’ve never had a problem at Pay1040, ACL Payments, or PayUSATax. (Regarding PayUSATax, I did have problems with the mis-matching zip code error until I used either “future payments” or preferably used the pre-registration step described in my post a few days ago).

I can make 36 payments of up to $997 each ($1,000 less debit card fee) for one person using the Simon Mall gift cards per tax year. That includes six per quarter for 1040-ES; six for Form 4868 extension requests early in the year; and six for regular 1040 tax payments (not 1040-ES) for a given tax year. Each group of six payments consists of two via each of the three payment processors. Regarding 4868, you can request an extension and make those six extra payments regardless of whether or not you truly file late.

I also make payments for a married couple in my family, a total of 72 per year (36 per person) for the couple, by treating them like individuals when making a payment. I do NOT submit joint payments, and the payments appear on their individual/separate IRS accounts. They file jointly and it seems to work fine.

The various types of payments can only be made at certain times of the year (not 100% certain of these dates, and I’m quoting someone else who posted some of these): Q1 3/1-5/15; Q2 5/15-7/15; Q3: 7/15-10/15; Q4: 10/15-?; 4868/1040: as far as I know, the first several months of the calendar year that follows the tax year in question.

Last edited 2 months ago by Frank
Jason Smith

If you make the 6 regular payments to the IRS in February and March and then when you file your taxes in April you don’t end up owing any money to the IRS, where do you file for the reimbursement for the overpayment? On line 26 you list overpayments for estimated taxes and the amount applied form the year before, but where would you list overpayments for the current tax year to get reimbursed?

Frank

You just list all of your payments on your 1040. If the total of your payments exceeds the amount of tax you owe for the year, the IRS generates a refund. It’s no different than if you had paid too much via payroll withholding or any other manner.

Example: If your total tax due for 2022 is $10,000, and you paid $11,000 via payroll deduction, plus you made 6 payments of $1000 each via Simon debit card for that tax year, you would have overpaid by $7,000. You simply file your 1040 showing everything and you will get a refund of $7,000.

Last edited 2 months ago by Frank
Jason Smith

So just to clarify, if you make an overpayment on your 2021 taxes, you list that on your 2022 taxes and will get that back as a refund when you file your 2022 taxes?

Frank

No, you’re making this way too complicated! It doesn’t span across two different tax years.

You are going to do exactly what you always do on your tax return:

  1. Calculate total taxes owed for the year.
  2. List all payments made for the year. (You’ll include any made via credit/debit card, payroll deduction, or any other method)
  3. If #1 > #2, you owe more money.
  4. If #2 > #1, you get money back.

So, if you make a credit/debit card payment toward your taxes in 2022, you’ll include that payment on your 1040 for 2022.

Tdot

I’m also unsure of where to include the six regular 1040 payments on my tax form. Let’s say I make 6 x $997 payments in January 2023, where do I include this $5,982? I’m using freetaxUSA and there is a place to enter my 2022 estimated tax payments, but I don’t see anywhere to enter the regular 1040 payments made in January 2023.

This assumes I do not owe any taxes for 2022 when I file in April 2023. If I do owe taxes, then these payments would be applied to that balance.

Craig fka Middle Age Miles

Attempt to use Simon $1k VGC as debit on PayUSAtax failed.

Error message says that the payment was declined by the card issuer because the billing zip code does not match what I entered in the payment form. However, the VGC has been registered using a matching zip code, so this should not be the actual problem.

If anyone has a workaround for this or has otherwise been successful using Simon VGC as debit on PayUSAtax, I would appreciate any helpful feedback. Thanks.

Frank

Hmmm. I just did this yesterday, as I noted below.

What will work instead is to make a future payment, dated for tomorrow. For some reason that doesn’t check zip code.

DONT DO TWO FUTURE PAYMENTS AT THE SAME TIME. Do one, wait for it to process, then do the next one a couple of days later.

Frank

Addendum: if you do two future payments at the same time, or for the same date, one will be ignored.

Also, you have to create an account to do a future payment. It’s a little hard to find, but click around until you find the option. Can’t remember which page it’s on. But it will be clearly marked once you find it.

Last edited 2 months ago by Frank
Craig fka Middle Age Miles

Frank, you’re a legend. Thanks so much. I registered the card using the link you provided, tried again on PayUSAtax, and it worked perfectly. Success!

And I apologize for missing your comment from last night. For some reason, it didn’t come up when I reloaded the page this morning. My browser must have pulled up a cached version of the page I had up yesterday rather than reloading.

Frank

Glad it helped! My first message was actually moderated, so it shows as posting last night but it didn’t actually appear until this morning. So, it wasn’t there when you first looked.

Frank

For those who are having their Simon gift cards rejected by PayUSATax for the wrong zip code, you need to REGISTER the card in addition to activation. Here’s the link (if you don’t have the link handy, just Google “Simon gift card registration”):

https://www.simon.com/giftcard/account_register.aspx

As part of the registration process, you do have to login, but your regular login (the one you use at simon.com/volume) won’t work – you have to create a separate account. (I confirmed with Simon customer service that this is what you need to do).

Once you register the card, it is usable at PayUSATax (and you don’t have to set it up as a “future payment”; you can pay immediately). Registration doesn’t appear to be necessary for Pay1040 or ACI Payments.

Last edited 2 months ago by Frank
Craig fka Middle Age Miles

Successfully used Simon $1k VGCs as debit on Pay1040 and ACI Payments for 3Q2022 estimated tax payments.

Thanks, FM, for maintaining this helpful resource!

Sergei

Citi just charged me a $10 cash advance fee on the service fee portion of my 1040-ES payment via ACI Payments. How can it be? Their FAQ specifically says it will be treated as purchase and I never before was charged any cash advance fees.

Raghu N

Just paid 497.45 at PayUSAtax.com ($2.55 fee), Vanilla MasterCard GiftCard from CVS. Previously Vanilla Vis did not work

Tom

 The estimated tax payment period overlaps. If I pay on 7/15/2022, how does the system know which quarter it is for?

J A

Use caution with Amex. Starting to see this spending excluded from meeting sign-up bonus requirement.

Big Chungus

Greg, confirming it happened to me today too

Kadav

It is a good idea to save 1% on tax payment, but I would like to inform that payusatax, Aci payments that they claim they will send the payment to IRS in 5-7 business days. Its been two months and they have collected my money over $6000. I have called their customer service multiple times and emails but no response. On the phone for hours to talk to some one but no luck. Their customer service is poor. I do not think to earn a 1% cash back with all those headache. I am not sure how is everyone’s experience here but mine was completely bad. I used 1% cash back debit card and save $50 but its too risky with the method, I would not recommend anyone to use above method to save 1%. My money is lost and there is no way I can communicate with vendor. When I called the IRS they said they have not received the money and I should contact the vendor. But there is no way to get in touch with vendor. I am not sure why IRS still doing business with PAYUSATAX and ACI PAYMENT INC.

BE CAREFUL GUYS. If anyone is having a bad experience please share how to retrieve my money. Thank you

[…] Today is the last day to pay your Q2 2022 estimated taxes. This can be a decent method for cashing out gift cards, or for sign-up bonus spend at a relatively low rate (between 1.85% and 1.97% for credit cards, less for debits). The Frequent Miler has a complete guide. […]

Daniel Chen

Looking to meet SUB for Amex Plat Business. I’ve done the overpayment method for the April yearly tax filing before and received a refund without any problems. Is this the same case if I do the same with quarterly tax payments? I don’t owe any taxes, but if I made a 15k before June 15, can I request a refund say, in July? Not too sure how quarterly taxes work. Thank you.

Satellite

No, you will not receive your overpayments quarterly. You’ll have to wait after you file taxes next year.

BenA

I’m using the Ink Unlimited this time with the offer of 5,000 for every 5,000, so 2.5%

Ed. C

I am going to owe a big {for me} tax bill next year. I have never had to make quarterly payments or estimated tax payments in my life. I received the offers for the AmEx Biz Platinum and the Biz Gold cards. I can easily meet the MSR for both these cards with taxes I will owe next year. If I mix in a lot of organic spend, is it okay to get these cards and use my tax payments to meet the MSR? Is there a limit on how much taxes you can prepay?

Charles
  • January 16, 2023: 4th quarter 2022 estimated taxes due.
  • (Payable online from 10/15/22 – ?)

?=12/31/22

jeph36

I am a first-timer paying for taxes like this, but I think I did it correctly. I used the $250 virtual Visa cards from giftcards.com, 2 of each at each of the 3 processors. All six transactions said they were successfully processed as Debit with the associated fees, including at PayUSAtax.com.

Jerry Love

Greg, can you please investigate why the Nearside 2.2% Debit Card will not work with either ACIPayments or PAY1040. I have tried but the customer service for both is abysmal and I have not been able to get a straight answer from either entity. It seems that each of these processors would had to have negotiated a contract with the IRS. If that contract called for acceptance of debit cards then neither entity is fulfilling its obligations under the contract. Thank you

James

I need to make quarterly payments of about $3k for fed taxes. If I pay $6k one quarter, is it fine to skip the payment the next quarter? Or am I still on the hook for the $3k payment the next quarter, and I wouldn’t get the extra $3k back until my final tax filing is settled? Thanks

Cavedweller

Put it all on the first one then forget about it for year.

Big Chungus

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.

Tahoe Trekker

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.

tim grable

I was just told by Amex that tax payments do not count toward points/bonus spend

Another Jeff

Worked as of January 2022 for me

Steve

Amex Business Platinum bonus awarded with $5k of $15k spend in March this year

Jessica

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.

Mark W

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.

Kris

Can also confirm receiving 2.2% back on PayUSAtax with Nearside.

Eric L Engberg

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.

Steve

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?

AManofWords

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.

Geoff

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?

ArchSF

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

veeRob

DP above disagrees with you.

Archsf

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.

Tim Steinke

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.

Last edited 7 months ago by Tim Steinke
ArchSF

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:

  1. You will earn 1% cashback plus a 1.2% cashback bonus in 2022 (total 2.2%) by using your Nearside business debit card for purchases. You will not earn cashback rewards on purchases of cash-like instruments (money orders, gift cards, etc.), peer-to-peer payments, money transfers and other transactions that do not involve purchases of goods and services. Terms and conditions apply.”

Thank you,
A

Bryce

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?

Kent

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.

Kent

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.

Geoff Stuart

@Kent, set up your login with IRS.gov through ID.me and you can see the details for your account, including date posted.

Evan F

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?

David

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

Izetta Brannon

Do I have to pay in all four quarters?

Geoff Stuart

@David, that’s very creative. High-five.

Sylvia

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).

Biggie F

Yes (unfortunately). Assuming those payments went through on credit card, you may need to start investigating what IRS account they got credited to. But presumably you have already filed your 2021 taxes and received a refund? If so, sit tight and see if the IRS comes after you. If they do, maybe that’s when you pull out your receipts from the credit card transactions and start to work with the IRS to find where the payments went. Also possible that during the wait for this shoe to drop, the credited payments will show up retroactively — the IRS is seriously understaffed and behind on things.

(FWIW, I went through something a year ago for 2019 [!] taxes in which IRS had not credited me for something [check, not credit card]. It is a bit harrowing, plus you learn a lot about how long a human can stay on hold, but they do have a system for investigating these issues.)

Sylvia

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?

Frank

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.”

iamhere

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.

greys

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?

Ka Da

According to the IRS, the tax due date is 18 April 2022, not 15 April (likely due to the Good Friday on the 15th).

ssss

Any thoughts on NYS taxes, which charges 2.25%?