If this tax year you are one of the unfortunate souls who must pay the IRS instead of receiving a refund, you have our sympathies. It is a bad situation, but there is a way to minimize the damage. Did you know you can pay your taxes with a credit card, among other methods? For those filing at the last minute, have a look at our best bets.
Pay on the IRS’s Own Credit Card System
The IRS allows you to pay them with a credit card over the web, over the telephone, or with a mobile device. This is allowable for those who filed electronically or by mail. It also works if you owe the IRS for some other tax related hassle. Best of all, since it is the IRS’s own service, they can’t blame you if they bungle your payment. However, you should double check your credit card statement to ensure the payment went through.
There are three methods of such payment for year 2017, and they include:
- Pay USA Tax – Also known as WorldPay US Inc, they charge a 1.98% fee for the transaction, as well as a minimum fee of $2.69 for credit cards. There is a $2.65 flat fee for debit cards.
- Pay 1040 – Also known as Link2Gov Corporation, they charge a 1.87% fee for the transaction, as well as a minimum fee of $2.59 for credit cards. There is a $2.59 flat fee for debit cards.
- Official Payments – They charge a 2% fee for the transaction, as well as a minimum fee of $2.50 for credit cards. There is a $2.25 flat fee for debit card transactions under $1,000. The fee rises to $3.95 for transactions over that amount..
See the IRS numbers for yourself by clicking here.
Credit cards accepted include the big four: Mastercard, Visa, Discover, and American Express. Debit cards accepted also include Mastercard, Visa, and Discover. They also accept Star, Pulse, and NYCE debit cards. You can even pay by digital wallet or PayPal. Fees vary when using these options.
Warnings on Paying Taxes With a Credit/Debit Card
Not all IRS tax returns are eligible for payment by credit card, debit card, or digital wallet. The above fees differ for those who choose the integrated IRS e-file and e-pay option. The IRS also has limits on how often individual and business payments can be made with this method.
Those of you who get miles or reward points on your debit/credit card may think you can get a nice payoff by using this method, but it can backfire. Since few debit/credit cards give you a 2% reward rate, it can be cheaper to send a check. You may also want to double check with your card to make sure they will treat a payment to the IRS as a purchase that qualifies for reward points.
Pay Your Tax Return in Houston
If you are about to pay this year’s taxes and need some help preparing your tax return in Houston, feel free contact us for assistance.