Pay taxes via credit card 2021/2022 edition [Updated]

Paying taxes via credit card can be rewarding, even if you don't like paying taxes. Credit card rewards are more important than tax payment fees. Paying taxes via credit card can be the solution if you sign up for a card that requires large spend to get a big welcome bonus.

This post has been updated several times since the last publication, including: caution about overpayments, added current deals, updated tax payment due dates, added Pay with Paypal bug workaround, updated what works and doesn't work with gift cards, and more.

Here is everything you need to know about paying taxes with credit cards.

Due dates that are important.

Tax year due dates in 2021.

Estimated taxes due in January 17 2022.

Payable online from 10/15-21.

End of year taxes are due in April of 2022.

Tax year due dates in 2022.

Estimated taxes due on April 15, 2022.

Payable online from March 22 to May 15.

July 15, 2022, the second quarter of the century.

Payable online from May 15th to July 15th.

The 3rd quarter of 2022, estimated taxes due, is September 15, 2022.

Payable online from July 15 to October 15.

The 4th quarter of 2022, estimated taxes due, is January 16, 2023.

Payable online from 10/15-22.

End of year taxes are due in April of 2023.

Current deals.

There were deals ending on 12/31.

Other notable deals.

Future deals.

Discover will give 5% back on purchases of up to $1,500 on July-September of 2022.

Pay taxes with a credit card.

You will need to know some important information about paying taxes with credit or debit cards.

The credit card fee was 1.96%.

The IRS has a list of companies that accept credit and debit cards. You can find the current information by clicking here. Three payment processing companies are on the list. Credit card fees range from 1.96% to 1.99%, while debit card fees range from $2 to $39.95 per transaction. You can pay taxes via the Plastiq Bill Pay service, but it will cost you more.

Additional information from the IRS.

There are additional information listed on the IRS page for paying by credit or debit card.

The card service fee goes to the IRS.
If you pay with a card, you don't need a voucher.
Business taxes are deductible for card processing fees.
To cancel a card payment, you must contact the card processor.
If you owe a debt on your account, the IRS will give you a refund.

The IRS has been very slow to do it in recent years.

Your card statement will show your payment as the United States Treasury Tax Payment or something similar.
Federal tax liens can take up to 30 days after we receive full payment, and liens may remain for other individuals who haven't fully paid their portion.
Different card fees apply when you pay your taxes online.

There is a payment limit per processor.

The IRS has a table of limits for using a credit or debit card to pay taxes. They say you can make up to two payments per tax period. You can make 2 payments every quarter to your estimated taxes, and you can make 2 payments every year to your taxes. In my experience, these limits are enforced by the payment processing company. If you make Plastiq bill payments, you can make up to 6 payments per tax period. I spoke with an IRS advisor several years ago and he did not think that using different processors would be a problem. I have made more than 2 payments per tax period many times and never had any issues. It is my own experience. I can't say that your outcome would be the same.

If you file with a partner, you can make payments in each person's name, but not always.

You can make your own payments if you are filing separately.

Cash advance fees are not included.

I am often asked if credit card companies charge cash advance fees when paying taxes with a credit card. The payment is treated as a purchase by the three official IRS payment processors. FAQ info can be found here, here and here.

Plastiq has unlimited payments.

You can make unlimited tax payments via the Plastiq bill pay service if you choose to. Plastiq charges 2.85% to pay bills with a credit card, but occasionally they offer lower fees. The Plastiq Bill Payment Service can be found here.

To pay taxes via Plastiq, use the tax payment screen.

Is tax payment fees deductible?

Tax preparation fees used to be deductible when itemizing deductions for personal tax returns, but that is no longer the case.

Card processing fees can be deductible for business taxes, which can substantially reduce the cost of using payment services.

You can see your tax payment history online.

You may want to show proof that the IRS received the amount you sent. You can sign up to view past payments on irs.gov.

When filing your taxes, estimated payments should be reported. If you make a mistake and don't report some of the payments, the IRS will eventually catch it and give you a refund.

How to pay taxes at the end of the year.

Tell your tax preparer or tax software that you will pay with a check. You can pay your taxes on the appropriate tax payment site. There is no need to mail the payment voucher.

If you over-pay your taxes, what will happen?

If you owe a debt on your account, the IRS will not refunds overpayments.

If it doesn't come automatically, you can request a refund.

You can schedule an appointment by calling the Taxpayer Assistance Center.

Do you need to send payment vouchers?

No. There is no need for a payment voucher. If you pay with a card, you don't need a voucher.

Pay with a credit card.

PayUSATax allows payments via PayPal. Sometimes cards like the Discover It, Discover It Student, and Chase Freedom offer 5% rewards for Paypal purchases.

There is a weird issue with selecting to pay with a credit card. I found a way to get the screen to load when I pressed the button.

Pay with both Pay by phone and Pay by internet.

Tax payment websites can be used to make mobile wallet payments. The US Bank Altitude Reserve card earns 3X for mobile wallet payments, so it should be a great match. Readers have reported that the Altitude's 3X rewards are not triggered by Visa Checkout support for the two Pay brands.

Checkout at Amex.

Tax payments are a great alternative since Amex doesn't count manufactured spending towards new credit card welcome bonuses. Even if you don't have a card, you can use Amex Express Checkout to make payments. If you signed up for a new Amex card and haven't received your physical card yet, you should still be able to pay with Amex Express Checkout.

There are many reasons to pay federal taxes with a credit card or gift card.

1. There is a profit.

A number of credit cards have higher cash rewards. You can earn 3% cash back in your first year of card membership.

Since you will earn 3% cash back on both the base tax payment and the processing fees with the above cards, your profit should be around 1% of your tax payment.

The example is:

A tax payment of $10,000 and a fee of 1.96% equals $10,196.
Cash back earned at 3% is $305.88.
A profit of $109.88 is 1.1% of $10K.

For more examples of cards that earn more than 2% rewards, see: Best rewards for everyday spending.

2. Minimum spend requirements should be met.

If you recently signed up for a new credit card, you will have to spend a lot of money in order to get the associated bonuses. Paying taxes is easy and cheap.

If you are interested in business cards, please click here to see the best offers.

Click on a card for more information.

3. Buy points cheaply.

Several credit cards offer up to 1.5 points per dollar. You can buy miles for 1.3 cents each if you pay a 1.99% tax payment fee. If you want to use your points for high value awards, you can buy 2X everywhere cards for 1 cent each.

2X example

A tax payment of $10,000 and a fee of 1.99% equals $10,199.
Miles earned 20,398.
The cost per mile is 0.98 cents per mile.

1.5X example

A tax payment of $10,000 and a fee of 1.99% equals $10,199.
Miles earned 15,299 at 1.5X.
Cost per mile is calculated by dividing the cost by the number of miles.

The cards that offer 2X points per dollar are the most popular.

Some cards that offer 2x everywhere are not included because their points are worth less than airline miles. Marriott cards offer 2x everywhere rewards.

2 cents per dollar, uncapped, is what the Citi Double Cash earns. Cash rewards can be converted to ThankYou points, which can be used to transfer points to a variety of airline and hotel programs.

There is a card offer and details.

The Citi Double Cash Card is a double card.

The card has 2X rewards for all spend and no annual fee. You can earn 2X everywhere and redeem for 2% cash back or 2X ThankYou points. You can make points transferrable with the premier or prestige card.

Mastercard World Elite is the card type.

2% cash back everywhere and 1% when paying your credit card bill for that purchase.

When you make a purchase, you get 1X and when you pay for it, you get 1X.

Amex Blue Business Plus gives you 2 Membership Reward points for every dollar you spend. Points can be transferred to a variety of programs.

There is a card offer and details.

The Blue Business® Plus Credit Card is offered by American Express.

Some people have been targeted for an offer in their online account for 50K points after 15K in purchases in their first year.

There is a recent better offer of 20K after 3 months of spend.

This card has 2X rewards for all spend and no annual fee makes it a winner.

Amex Credit Card is the card type.

Membership rewards points can be earned on all purchases up to $50K per year. There are terms that apply. Rates and fees.

Capital One Venture, Venture X, or a combination of the two. Capital One offers three cards that can earn 2XMiles per dollar. The airline miles and hotel points can be transferred at a 1 to 1 rate. The following cards can earn 2X miles everywhere.

There is a card offer and details.

The Capital One Venture rewards credit card.

50K after $3K in the first 3 months, 20K after 20K in the first 6 months, and 100K after 20K in the first 6 months.

The card earns 2miles per dollar, which is worth 1 cent each toward travel. This makes the return on spend similar to a 2% cash back card, though you must redeem your miles to get 1 cent per mile. Capital One has an advantage over cash back: they can transfer their "miles" to airline points.

The card type is Visa signature.

There is an earning rate of 2X everywhere.

Receive up to $100 application fee credit for Global Entry, and convert "miles" to airline miles and hotel points.

Capital One Venture X rewards credit card.

The card offers annual rebates that can be used to mitigate the fee for those who travel frequently and could be worth it for the lounge access and travel protections. Priority Pass, Capital One Lounges, and the President's Circle status are available to authorized users. The Capital One Venture rewards card is worth exactly 1 cent each for travel, and the card earns 2 "miles" per dollar on most purchases. This makes the return on most spend similar to a 2% cash back card, though you must redeem your miles to get 1 cent per mile. Capital One has an advantage over cash back: they can transfer their "miles" to airline points.

Visa Infinite is the card type.

The earning rate is 10X on hotels and rental cars booked via Capital One Travel.

Up to $300 in statement credits annually for bookings made through Capital One Travel, 10,000 bonus miles each year starting at the first anniversary, and up to $100 application fee credit for Global Entry or TSA Pre®.

There are cards that offer 1.5X points or airline miles.

Chase Ultimate rewards are available. 1.5 Ultimate rewards points are earned for every dollar spent on the two no-fee cards. You can transfer points with either one or both of them.

There is a card offer and details.

Chase Freedom is a program.

More.

$840

The first value estimate.

Credit card sign up bonusestimation

20K points, 5X grocery, and 15 months of no interest.

After spending $500 in the first 3 months, you can earn 20,000 points and 5x Ultimate rewards points, which will give you 5% cash back on up to $12K in purchases. There is a variable rate of 14.98 - 23.74% for the first 15 months from account opening.

No yearly fee.

This card is subject to the Chase rule. Even though this card is marketed as a cash back card, it actually earns Ultimate rewards points which can be redeemed for 1 cent each, or can be combined with other Ultimate rewards-earning cards to get even more value. If you have not received a new cardmember bonus for this card in the past 24 months, this product is available to you.

The mini review is great for 3x categories and 1.5X everywhere else. Excellent companion card to any of the above.

The card type is Visa Signature or Platinum.

5x travel booked through Chase, 5x dining, 3x drugstores, and 1.5x everywhere else.

Upon activation, there is a free DashPass for up to 3 months.

Chase Ultimate rewards complete guide is also available.

Amex Membership rewards can be used. Two Amex cards can earn up to 1.5X. The Business Platinum card requires purchases of $5K or more to earn 1.5x when paying taxes, and the Everyday Preferred card requires 30 charges per billing cycle to earn 1.5x.

There is a card offer and details.

The Platinum Card from American Express is used for business.

The card is loaded with high end perks. The perks may be worth more than the annual fee. If your application is received after January 13th of the following year, you will pay the $595 Annual Fee.

Amex pay over time card

1.5X points per dollar on eligible purchases of $5000 or more, 1.5x on construction/hardware stores, electronic goods, and shipping, and 1X on memberships at AmexTravel.com.

Up to $400 a year in statement credits for Dell purchases, up to $200 a year for airline incidental fees, and up to $120 a year for wireless services credits. Enrolling for certain benefits is required.

The Amex Platinum Guide is also available.

American Express has a preferred credit card.

The 50% bonus on points earned is one of the strongest mile-earning cards available.

Amex Credit Card is the card type.

3x points at US supermarkets on up to $6,000 per year in purchases, 2x points at US gas stations, and 1x points on other purchases are earned.

You can get 50% more points if you use your card 30 or more times in a billing period. There are terms that apply. You can see rates and fees.

There are airline miles. 1.5 miles per dollar is offered by a few airline branded cards.

4. Valuable big spend bonuses include elite status, free nights, companion pass, etc.

Credit cards offer bonuses for meeting high spend thresholds. There is a comprehensive list of the best big spend bonuses. There are a few examples.

Amex Delta Reserve or Delta Reserve Business: Spend $30,000 and get 15,000 Medallion Qualifying Miles. You will get another 15,000 Medallion Qualifying Miles if you spend $60,000, $90,000, and $120,000.
Amex Delta Platinum or Delta Platinum Business: Spend $25,000 and get 10,000 Medallion Qualifying Miles. You can get another 10,000 Medallion Qualifying Miles if you spend $50,000.
You can get a companion pass for an unlimited number of flights with Southwest if you accumulate 125,000 points in a year.
If you spend $50,000, you can get Mosaic status, which includes free changes and cancellation, expedited security, early boarding, free drinks, enhanced point earnings, and 15,000 bonus points.

5. Liquidate Visa/MasterCard gift cards.

Visa and Mastercard gift cards are not cash. They can get low flat fees for tax payments with the tax processor you use. The cost to liquidate $500 gift cards will be half a percent. That is cheap.

You can pay with Visa/MasterCard gift cards.

The IRS imposed 2 payments per processor limit, which is the biggest problem with this. In the past, official payments allowed more payments via phone, but recent reports indicate that this is no longer the case.

There are many options for buying Visa and Mastercard gift cards.