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Pay Taxes with a Credit Card?Can I pay my taxes with a credit card? Yes. SHOULD you pay taxes by credit card? No! I will be the first to tell you that I am a huge proponent of cash back credit cards or rewards credit cards and in fact I try to use my True Earnings American Express Card for as much as I possibly can BUT you won’t find me paying taxes with my credit card. Here is why.

The IRS allows anyone that wants to to pay federal taxes online with a credit card BUT the very important catch is that the convenience charges range anywhere from 1.95% to 3.93% of your total taxes paid. So, just because you may be earning some nice rewards or points with your credit card then they likely will not even be close to compensating for the 1.95% to 3.93% that gets lopped right off of the top of any IRS credit card tax payments that you make.

However, if the question becomes, “Should I pay my taxes with a debit card?” then things change drastically because rather than having to pay a convenience fee of 1.95% to 3.93% of your total tax payment with a debit card you only have to pay a flat fee of right around $4. This means that for all of you savvy consumers who justifiably chase credit card rewards at every opportunity you should dial it back a notch and NOT pay your taxes with a credit card but rather try a cash back debit card like the PerkStreet rewards debit card if you must use a rewards card to pay your tax bill.

Here are the latest numbers from the IRS on paying taxes online with a credit card or debit card:

IRS pay by credi cardStill thinking about using your credit card for paying estimated tax payments or regular tax payments? Think long and hard before slapping down your plastic!

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Disclaimer: This content is not provided or commissioned by American Express, Visa, MasterCard, Discover, or any other credit card company or issuer. The opinions expressed here are the author's alone, not those of any credit card company or issuer, and have not been reviewed, approved or otherwise endorsed by any credit card company or issuer. Credit Card Chaser may be compensated through various affiliate programs with advertisers. As always, Credit Card Chaser is an independent website commmitted to helping people research credit card offers and find the best credit card!

One Response to “Are You Sure You Want to Pay Taxes With a Credit Card?”

  1. Mike says:

    This is really good information. I was not aware there was a difference in using a credit card, or a debit card to pay taxes with. SO it looks like not only does Uncle Sam get your money, but the banks and credit card companies get it too!

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