[Q2 Estimates Due Today] It Keeps Getting Better To Pay Your Taxes With A Credit Card, 2024 Is Now The Best Year Ever To Pay Your Taxes On A Card!

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DansDeals will receive compensation if you are approved for a credit card via a link in this post. Terms apply to American Express benefits and offers, visit americanexpress.com to learn more.

Update, 6/17/24: Q2 estimated tax payments are due today. Which card will you use to come out ahead of the fees?

Update, 4/15/24: It’s tax day, which card will you use to make a payment?


Originally posted on 1/1/24:

Paying taxes on a credit card:

Credit card processing fees are updated annually on January 1st.

Luckily not everything is subject to inflation. You can now pay just 1.82% to process your tax payment via credit card! You can make estimated payments at any time. 2023 Q4 estimates are due 1/16/24.

If you aren’t able to use your card to make a payment, try paying via Paypal.

Here is a history of what credit card processing fees for taxes have cost:

  • 2003-2009: 2.49%
  • 2010: 1.95%
  • 2011: 1.9%
  • 2012: 1.89%
  • 2013: 1.88%
  • 2014-2020: 1.87%
  • 2021: 1.96%
  • 2022: 1.87%
  • 2023: 1.85%
  • 2024: 1.82%

 

  • You can make 2 payments per credit card processor for each quarterly estimate (1040-ES).
  • You can make 2 payments per credit card processor for your year end bill (1040).
  • You can make 2 payments for an extension of time to file (4868).
  • You can make 2 payments for past amended returns (1040X).
  • You can make another 2 payments each time by using a spouse’s information to pay, though you may have to call the IRS to confirm that they link that payment to your joint return as that doesn’t always happen automatically. You can also call the IRS to reallocate payments.

You can view all previous tax payments made to the IRS here.

The tax payment fee may be considered a business expense, which will significantly change the math below based on your marginal tax rate. Be sure to speak to a tax professional about that.

Tax payments are considered a regular purchase, not a cash advance.

You can also request a refund for any overpayment and the IRS will cut you a check or a direct deposit into your checking account. You may even wind up getting paid interest by the IRS if the refund check is delayed.

You can also request that up to $5,000 of overpayments per return be converted into I Bonds. That’s on top of the regular $10,000 per person limit for I Bonds purchases.

Big welcome bonuses:

It can definitely make sense to pay your taxes via credit card if you are signing up for a card and are trying to reach a spend threshold to earn a signup bonus that you won’t be able to reach without some help. The 1.82% fee pales in comparison to earning a mega signup bonus as well as the regular miles for the purchase.

Chase:

AMEX:

Capital One:


Best Cards To Pay Taxes With:

Even if you don’t have a new card, it can still make sense to pay your taxes with a credit card for the rewards and the extra time to pay.

In order to determine if it’s worth earning miles at a 1.82% rate, you’ll need to assign a value to each currency. Values are highly subjective and will vary based on what you use the miles for, so YVMV (Your valuation may vary!).

  • The Ink Business Premier℠ Credit Card earns 2.5% cash back on $5,000+ purchases and 2% cash back on small purchases, so you’ll come out .68% ahead of the 1.82% tax processing fee on $5,000+ payments. There are no limits on the 2.5% cash back. Note that this card doesn’t earn transferable points like other Chase Ink cards.
    • A $5,000 tax payment will cost $91, but you will earn $127.28 cash back.
    • A $10,000 tax payment will cost $182, but you will earn $254.55 cash back.
    • A $100,000 tax payment will cost $1,820, but you will earn $2,545.50 cash back.

  • The Blue Business℠ Plus Credit Card from American Express offers 2 points per dollar spent everywhere. If you open this card now you would also earn 15K points for spending $3,000 in 3 months. No annual fee.
    • A $10,000 tax payment will cost $182, but you will earn 20,364 points. If you value your AMEX points at 1.4 cents each, that a value of $285.10 worth of points. You can transfer those points into miles with airlines like Avianca, British Airways, Delta, Singapore, Virgin Atlantic, and more.
    • Note that you only earn 2 points per dollar on $50,000 of annual spending, though if you have multiple primary cards they would get 2 points per dollar on $50,000 of annual spending on each card.

  • The Chase Ink Business Unlimited Card earns 1.5 Chase Ultimate Rewards points per dollar spent everywhere. If you open this card you would also earn $750 in the form of 75K points for spending $6,000 in 3 months. No annual fee.
    • A $10,000 tax payment will cost $182, but you will earn 15,273 points. If you value your Chase points at 1.5 cents each, that a value of $229.10 worth of points. If you or someone in your household has a Sapphire Preferred, Sapphire Reserve, or Ink Preferred then you can transfer points to one of those cards and from there to airlines like United and hotel programs like Hyatt. Alternatively if you have a Sapphire Reserve you can also redeem those points for 1.5 cents each towards travel, while having the Sapphire Preferred or Ink Preferred would also you to redeem those points for 1.25 cents each towards travel.

  • The Chase Freedom Unlimited® card earns at least 1.5 Chase Ultimate Rewards points per dollar spent everywhere and 3 points per dollar spent during the first year of cardmembership on up to $20K of spending via this link. No annual fee.
    • With an existing card, a $10,000 tax payment will cost $182, but you will earn 15,273 points. If you value your Chase points at 1.5 cents each, that’s a value of $229.10 worth of points.
    • If you get this card with an offer to earn 3 points per dollar, a $10,000 tax payment will cost $182, but you will earn 30,546 points. If you value your Chase points at 1.5 cents each, that’s a value of $458.19 worth of points. If you or someone in your household has a Sapphire Preferred, Sapphire Reserve, or Ink Preferred then you can transfer points to one of those cards and from there to airlines like United and hotel programs like Hyatt. Alternatively if you have a Sapphire Reserve you can also redeem those points for 1.5 cents each towards travel, while having the Sapphire Preferred or Ink Preferred would also you to redeem those points for 1.25 cents each towards travel.

  • The Business Platinum Card® from American Express offers 1.5 points per dollar spent everywhere on transactions that are $5,000 or more.
    • A $10,000 tax payment will cost $182, but you will earn 15,273 points. If you value your Business Platinum AMEX points at 1.5 cents each, that a value of $229.10 worth of points. You can transfer those points into miles with airlines like Avianca, British Airways, Delta, Singapore, Virgin Atlantic, and more.
    • You can earn 1.5 points per dollar on up to $2,000,000 of annual spending.
    • Having this card allows you to get 35% of your AMEX points rebated on all business/first paid airfare and on coach airfare with the airline of your choice, up to 1,000,000 bonus points per calendar year.


  • The Citi Double Cash® Card earns 2% cash back, so you’ll come out .18% ahead of the 1.82% tax processing fee. Even if you don’t want to deal with the miles aspect of this, the 2% cash back makes it a no brainer to use.
    • You can also transfer points from this card to a Citi Premier® Card Card, from where you can transfer points to airlines like JetBlue, Turkish, Qantas, and more. A $10,000 tax payment will cost $182, but you will earn 20,364 Citi ThankYou points. If you value your Citi ThankYou points at 1.4 cents each, that a value of $285.10 worth of points. If you also have a Citi Rewards+® Card you’ll get a 10% rebate on point redemptions and transfers, making the points even more valuable!

  • Capital One Spark Cash Plus earns 2% cash back, so you’ll come out .18% ahead of the 1.82% tax processing fee. Even if you don’t want to deal with the miles aspect of this, the 2% cash back makes it a no brainer to use.
    • A $10,000 tax payment will cost $182, but you will earn 20,364 Capital One points. If you value your Capital One points at 1.4 cents each, that a value of $285.10 worth of points.

Earn Status And More!

Earn AA elite status and companion certificates:

  • The Citi Business AA Platinum card offers a free domestic companion certificate for spending $30K/year and earns 1 loyalty point per dollar spent to earn AA status.
  • The Citi AA Executive card earns 1 loyalty point per dollar spent to earn AA status plus earns a bonus 10K loyalty points for earning 50K loyalty points in a year and another bonus 10K loyalty points for earning 90K loyalty points in a year.
  • The Citi AA Platinum Consumer card earns 1 loyalty point per dollar spent to earn AA status, plus offers a $125 AA flight discount if you spend $20K/year.
  • The Citi AAdvantage MileUp Consumer Mastercard earns 1 loyalty point per dollar spent to earn AA status.
  • You’ll need to earn 39K loyalty points for Gold, 74K for Platinum, 124K for Platinum Pro, and 199K for Executive Platinum status after the 1K bonus. At 175K loyalty points you can choose 25K bonus miles or 2 systemwide upgrades, and at 250K loyalty points you can choose 60K bonus miles or 4 systemwide upgrades.
    • I value AA miles at about 1.4 cents each, so if you’re paying taxes at a cost of 1.82 cents each, that would be valuing each loyalty point at roughly 0.42 cents each, but at 175K and 250K that cost goes down if you select 25K miles or 60K miles. That would put the cost of Gold status at $168, Platinum at $315, Platinum Pro at $525, or Executive Platinum 200K at $490 after backing out the 25K bonus miles or Executive Platinum 250K at negative $140 after backing out the 85K bonus miles. Status earned starting 3/1/24 would be valid through 3/31/26.
    • Read more here.

Earn Southwest elite status and Companion Pass:


Earn Hyatt elite status, upgrades, and bonus free nights:

  • The Chase World Of Hyatt Consumer Credit Card offers a 2nd annual anniversary night if you spend $15K in a calendar year. If you open a new card you can also earn up to 60K bonus points with $15,000 of spending within 6 months.
  • This card also offers 5 elite qualifying night credits every year and you’ll earn an additional 2 night credits towards elite status with every $5,000 that you spend.
  • The Chase World Of Hyatt Business Credit Card earns 5 night credits towards elite status with every $10,000 that you spend. If you open a new card you can also earn 60K bonus points with $5,000 of spending within 3 months.
  • It also offers a 10% rebate on award stays, up to 20K rebated points, after you spend $50,000 on the card in a calendar year.

I value Hyatt points at about 1.5 cents each, so depending on how many additional free nights and elite status benefits you can rack up and how you value those free nights and benefits, it can make sense to put tax payments on this card.

As of today, you can also earn new milestone benefits described here.


Earn Marriott elite status and bonus free nights:

  • The Marriott Bonvoy Business® American Express® Card offers a 2nd annual free night for spending $60K in a calendar year.
  • The Marriott Bonvoy Brilliant Consumer AMEX offers a 2nd 85K award night for spending $60K in a calendar year.
  • The discontinued Ritz-Carlton card offers Platinum status for spending $75K in a calendar year. You’ll need to determine how to value having Platinum status to see if its worth putting tax payments on this card.
    • I value Marriott points at about 0.6 cents each, so depending on how many additional free nights and elite status benefits you can rack up and how you value those free nights and benefits, it can make sense to put tax payments on this card.

Earn JetBlue elite status:

  • JetBlue cards offer 1 (Mosaic qualifying) tile for every $1,000 spent. Spend $50K for Mosaic Tier 1, $100K for Tier 2, $150K for Tier 3, or $200K for Tier 4.
    • JetBlue points are a fixed value currency, so there are no aspirational aspects to this program as points will typically be worth between 0.9-1.3 cents each. You’ll need to determine how to value having Mosaic status to see if its worth putting tax payments on this card.

Earn Delta elite status:


Earn United elite status:


Earn Air Canada Aeroplan status or a companion pass:

  • The Chase Aeroplan® Credit Card offers 25K status for spending $15K/year through the following calendar year.
  • If you spend $50K in a calendar year you will gain a level of status.
  • Upon spending $100,000, $250,000, $500,000 and $750,000 in a calendar year you’ll earn a 50% off Priority Rewards redemption certificate.
  • If you spend a whopping $1,000,000 in a year you’ll get a companion pass that allows unlimited free companion award travel systemwide in any class of service. That pass will be valid for the rest of the calendar year in which you spend the million bucks and for the following calendar year.
    • I value Aeroplan miles at about 1.3 cents each. You’ll need to determine how to value earning qualifying miles and the flight spending requirement waiver to see if its worth putting tax payments on this card.

Earn a British Airways companion pass:

  • The British Airways Visa Signature® Card offers a free one-time use companion pass for spending $30K/year. If you open a new card you can also earn 75K bonus Avios for spending $5,000 in 3 months, plus 5 Avios per $1 spent on gas, grocery store and dining purchases for the first 12 months of your account opening or up to $10,000.
  • The free companion pass is valid on BA award tickets worldwide, though fuel surcharges will apply. You can now also get 50% off an award for 1 person if you don’t have a companion.
    • I value BA Avios at about 1 cent each. You’ll need to determine how to value the companion pass to see if its worth putting tax payments on this card.

Earn an Aer Lingus companion pass:

  • The Chase Aer Lingus offers a companion ticket good when booking a paid economy Aer Lingus ticket if you spend $30,000 in a calendar year. If you open a new card you can also earn 75K bonus Avios for spending $5,000 in 3 months, plus 5 Avios per $1 spent on gas, grocery store and dining purchases for the first 12 months of your account opening or up to $10,000.

Earn a $1,000 Iberia voucher:

  • The Chase Iberia: offers a $1,000 discount voucher off 2 tickets on the same Iberia flight if you spend $30,000 in a calendar year. If you open a new card you can also earn 75K bonus Avios for spending $5,000 in 3 months, plus 5 Avios per $1 spent on gas, grocery store and dining purchases for the first 12 months of your account opening or up to $10,000.

Earn Hilton elite status and bonus free nights:


Is it worth it?

If you’re coming out ahead of the cashback earned on a card, this is a no-brainer.

As for earning miles, it all depends on what you do with your miles. This isn’t the cheapest way to earn miles, but it’s painless. The ability to overpay your taxes to reach a threshold is also helpful.

The value of airline miles is huge if you fly last-minute, one-way, or in business or first class internationally.

  • If I need a last minute short-haul flight like Cleveland-NYC that can cost $500 each way, I can instantly transfer 6K miles to Air Canada, 6K points to Qatar, 6.5K points to Avianca Lifemiles for travel on United or 8.25K points to British Airways to book a short-haul on American with no last minute booking fees. That’s a value of up to 7 cents per point.
  • With 10K Turkish miles I can book a one-way flight on United to anywhere in the US, even Hawaii or Alaska. In business class it’s just 15K miles each way!
  • 86K points transferred to Singapore is enough for a ticket in a private couples suite on an A380 one-way from JFK to Frankfurt with no fuel surcharges.
  • If I want to fly in a $25,000 ANA First Class Suite round-trip from the US to Tokyo, I can instantly transfer 145K or 170K points to Virgin Atlantic. That’s a value of up to 18 cents per point.
  • If I want to stay in a 5 star Park Hyatt in the Maldives, Melbourne, NYC, ParisSydney, or Tokyo that would cost over $1,200/night, I can instantly transfer 20K-40K points to Hyatt to do that, a value of up to 6 cents per point.
  • Learn more about which points transfer to which airlines and how long those transfers will take here.

Which card do you use to you pay your taxes? Or is it too pricey of a method to get miles? Sound off in the comments!

Leave a Reply

67 Comments On "[Q2 Estimates Due Today] It Keeps Getting Better To Pay Your Taxes With A Credit Card, 2024 Is Now The Best Year Ever To Pay Your Taxes On A Card!"

All opinions expressed below are user generated and the opinions aren’t provided, reviewed or endorsed by any advertiser or DansDeals.

raja

Is it possible to do tax calculation using any website, say Turbotax.com, and come back to this website and pay that amount? That way, you know your exact tax amount and not really paying that turbotax fees.

Ken

Yes, correct. Do not pay via TurboTax even if filing through them. Just file and “pay later”, then go to this website.

raja

Awesome, Thanks a lot!

print

can you just print money by using 2.5 percent card and then getting back refund for irs? or is there a limit to this

L B

Yes, No limits on it

AE

No, not like that. Theoretically there is no limit to how much you can prepay, but you can only pay a limited number of times. You will also generally have to wait to file your taxes to get the money back. You can’t just pay and then request a refund as much as you want. A) The IRS won’t do it, and B) you are asking for an audit.

Keep in mind the opportunity cost as well. If you pay now and wait until April to file your taxes and get a refund, you are losing out on (at a minimum) 1% interest just from keeping your cash in a checking account for 3+ months, vs. the 0.68% you will earn by this method.

robertw

I would give you a better idea than that. Get a 0% 12-15 month credit card or cards. There are several. Prepay your taxes and all your expenses for everythign you spend, insurance, whatever. You can find 12 month or similar CDS at 5% or slightly higher, or possible structure Tbills if you state income tax and clear more than the the example you give. The main thing is you need proper control to make sure you pay those cards 100% when due and not to spend the entire credit line since it dings your score on utlilization.

Ag

Can I pay W-2 taxes with a CC?

L B

Yes, you can pay the 941 (payroll taxes) with a cc, if you are the employer.

Peter

Not worth paying with an IHG card to possibly get Diamond status? Any easier way to get it if you can’t stay the nights?

Moe

“This isn’t the cheapest way to earn miles, but it’s painless.” What’s the cheapest way?

Avi

I am getting an error cannot pay personal taxes with a business card. How can I get around this?

Shay

worked for me w/ AmEx Blue Business Cash (2% back)

HarvesterOfPointsAndSorrow

This is disheartening to hear. My plan is to apply for a Southwest biz card (I’m chasing the companion pass) and pre pay taxes. I hope we hear some more data points about paying with business cards.

MY

I have to pay $30K in taxes at the moment and suffering sever analysis paralysis from these posts. Any one care to be my expert on this?

AE

Probably your best bet for simplicity is the Venture X or Citi Double Cash. Both give 2% flat transferable miles. The Chase Ink Premier would get you 2.5%, but that is cash back vs. transferable miles. (Although glitches do occur!)

With $30K you can score some nice signup bonuses – Chase Ink cards (90K/120K for $6K spend, 100K for $8K spend) would be a good place to start. Or the Cap One Business Venture X (150K for $30K spend).

MY

TY!

yankel

paid on the ink unlimited (targeted spend 6k receive 120,000 and blue business plus targeted spend 15k in first 12 months receive 50,000 + 2 MR points per dollar first 50k – plus added employee card)
and both have 12 months 0% so in addition to meeting the sign up bonuses, the 1.82% is def worth it for me.

DanR

Anyone else having issues processing a second payment under the same SSN. It is not working for me

Dovid

I keep on getting an error message on PayUSATax.com when trying to pay with a credit card – any advice?

V

Hi Dan,
Does paying property tax through paypal incur processing fee ?

Dovid

I normally file taxes once a year (and get a refund). Where would I “pre-pay”, under estimated tax?

jake

keep in mind that if you are trying to hit a bonus, or for any other reason for that matter, paypal algorithms and policy and back end will not automatically decline your payment if your card is declined. eg, if its over the limit or simply declined as fraud by your bank. rather, paypal will automatically, and without notice, try additional backup payment methods, such as an alternate card, bank account etc, to process the payment. this can lead to paypal charging the smaller fee to the intended card and the larger amount to a backup card. and if your backup isnt 0%, that can be financially harmful

Ericgnd

How much can be charged on the card/ payment. Is there a cap? If so how can i spend 100k on a tax payment on the cap one card?

Ericgnd

Anyone?

Shmuli

“You can also request a refund for any overpayment” How does this work ? Can you only do it while you file your annual taxes ?

eve

Im getting a 1.87% being charged

Jim

On Friday, I tried to use a business card to pay Q1 estimated taxes for 2024. The site I was using was official payments.com. It didn’t allow me to use a business card and said I had to use a personal card. Never had that happen before, has anybody had that happened to them this year??

Smart

It happened to me on Friday and just today I decided to try through PayPal and it worked

M

Turbo tax was definitely charging more than 1.8% processing fee

Smart

I tried using business premier and it kept giving errors. But it worked through PayPal

HelpMe

BOA w/bonus, 2.625%. Not as good as the 6.125% during the coin days.

Jake

U need to update the 6k aeroplan transfer last minute. You wrote the other day how it doesn’t apply anymore as united is blocking space

DR

I have a Chase credit card that cannot be expedited and can ONLY be added to GPay, not PayPal (UGH!). Anyway, is there a way to do Tax Payment with GPay? Does anyone know if you can use GPay for the existing sites to pay federal taxes?

The only options I see, when using my phone, on the websites, are plain old CC, PayPal, and Click to Pay (which requires the CC Info). Do any of the 3 payment processors accept GPay? TIA!

DealRaider

There is a bit of risk that the payment processor does not correctly transfer the funds to the IRS, or that the IRS takes too long to credit, and you end up getting an unpaid letter. Check reddit for several nightmare stories. This seems great when it works, but if something goes wrong it sounds like a major headache to try and get it resolved.

Overnight potato kugel

1. If it’s due tomorrow, won’t it be too late till I get one of these cards in the mail to pay?

2. If I need funds to show for a mortgage..and don’t want to spend lots now in taxes… I should probably get a card that has 0% apr… Which card would be most recommended?

Shkoiach.

S

Too late to get a card now as you said, but best for you would probably be 0 APR Ink. Carrying large balance on a personal card will dent your credit score, but on a business Ink, it won’t.

Overnight potato kugel

Shoots. I just got 2 new cards to cover the full balance. I managed to get the card numbers without waiting for the physical card.

But I didn’t know that I’d do better on a business card, as you said.

Thanks!

S

Don’t think it would have been possible with Chase (the Inks). Be careful with your credit utilization and credit score if you’re applying for a mortgage soon.

Ben

I used this offer https://www.dansdeals.com/points-travel/milespoints/register-bonus-miles-pqps-united-card-spending/ . May not be the best value, but with this offer, I should be able to book a flight with the points that cost more than the fees did.

NewbieNoMore

I have boa premiere card with 2.65% but worried about paying 10k plus and messing up my credit score for high utilization.

Karen

If you pay it off as soon as it posts it shouldn’t be a problem.

JustGotItDone

Very strange but when the 1.82% processor kept denying my chase business card and wouldn’t let me connect tho PayPal either…I tried the 1.87% processor and it worked!

eve

what number do I call at the
IRS to ask for a refund?

EC

’ My upcoming real estate payment on 5/10 is for the school tax & is for $8516. They charge a fee of 2.3% to pay by credit card ($295). Assuming my Chase points are worth 1.5, I would earn 12,774 points. How do I determine if the 22,774 points are worth $295? I could use either Chase Ink Cash or Business Unlimited, and I have a Sapphire Preferred card. Thanks for advice.

EC

Anyone?

EC

No one.

Chanie

I am waiting for a new credit card to arrive. My estimated taxes are due on June 17. When is the latest date I can make a credit card payment? If I make a charge on Friday June 14, Will it post for June 17th? I don’t want to pay a 5 percent late fee.

4yourinfo

Apparently, the fee is considered an expense – you just have to be eligible and itemize to claim it.
https://www.irs.gov/pub/irs-news/ir-09-037.pdf

4yourinfo

It looks like the rules changed and you can’t deduct these Misc fees
https://www.irs.gov/pub/irs-prior/p529–2020.pdf

ID

I want to pay my property tax, but credit line isnt enough, and they allow only one payment, can I prepay (citibank), to get more available funds? e.g. my tax is 10k and my credit line 8k, can I prepay 2k and charge a transaction of 10k? anyone knows??

wpDiscuz