GREENSBORO, N.C. — Tax Day is May 17, 2021. Even if you file for an extension, you still have to pay any estimated taxes you owe by May 17. The extension is just for paperwork, not the money.
Can you pay your taxes by credit card?
The IRS website
Nathan Grant, Credit Card Insider
“The IRS does allow you to pay with a credit card but, you can't pay directly, you have to go through one of three processors, so with each one of those comes an additional fee,” said Grant.
On the IRS website, you can see the three processors and the fees charged. Scroll down a little farther and you can see the fee comparison.
The charges are anywhere from a flat $2.55 to $200. The fee is on top of whatever interest fee your credit card charges you.
Most money experts strongly recommend against paying your taxes with a credit card due to the fees and interest, even if it's a rewards card.
“Most general cashback rewards cards they only earn you at most 2% back which is basically what the fee is by paying by credit card, so you're not earning, you’re just off-setting,” said Grant.
Grant says if you have a sign-up bonus on a card, it may help you some.
“Let's say you signed up for your card at the beginning of the year and they say if you spend X amount within the first three months you get bonus points or cashback, those are like 20% in that case, it might be beneficial to you,” said Grant.
You can read more from Credit Card Insider about paying taxes with a card.
Verify: Yes, you can pay your taxes with a credit card.
Many money experts would say instead of paying with a credit card, set up a payment plan with the IRS. The interest will most likely be less.