The 10 Best Ways to Pay Your Taxes With Credit & Debit Cards

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 Disclaimer:  I am NOT a tax professional, so please consult YOUR tax professional before you make any tax-related decisions.  Information in this post continually changes, so please double check before applying for cards or making any payments.  I get a referral for some of the cards in this post.

Many folks who are self-employed have to pay estimated taxes to the IRS.  However, they can make up to 2 payments a quarter using a credit or debit card, but have to pay a convenience fee.

The IRS website suggests that you can only make 2 payments a quarter using a credit card, but it isn’t clear if that is 2 payments per quarter per credit card service provider or if it is a blanket restriction on the number of payments you can make through any credit card service provider.

However, the website for paying my Kansas state taxes did NOT have a restriction on the number of payments which I could make per quarter.  So I’d use multiple cards with lower credit limits to pay my state taxes and “save” my cards with larger credit limits to pay my federal taxes.

For paying federal taxes, the lowest fee for using a Visa or MasterCard credit card is 1.89% through Pay USA Taxes and the lowest fee for using an American Express credit card is 2.29% from Value Tax Payment.  For Kansas state tax, the lowest fee which I could find was 2.25% for all card types from Pay KS Tax.  So try to use your American Express cards for state payments first, and save your Visa/MasterCard for federal payments to take advantage of the lower convenience fees.

For most folks, it could be worth it to pay a convenience fee just to meet the minimum spending requirement for a credit card sign-up bonus.  If you’ve got a small tax payment you could even earn 5X points by using a Vanilla Visa and following Frequent Miler’s instructions.

But Big Spenders get to choose from additional benefits!  I’ve drawn from my series on Big Spenders to list the best ways to pay your taxes with a credit card if you’ve got tens and hundreds of thousands of dollars in tax payments.

I’ve listed the options according to cost (so American Express cards end up at the bottom because of the additional fee), my preferences and what I value.

Card
Tax Paid
Convenience Fee (%)
Convenience Fee ($)
Benefits
Delta Debit Card$35,000-$3.4935,000 Delta Miles
Citi Hilton Reserve$40,000 (Within 1 Calendar Year)1.89%$756120,000 Hilton Points + Top-Tier Hilton Diamond Status +1 Free Weekend Night
Chase Southwest Premier$110,000 (Within 1 Calendar Year)1.89%$2,079110,000 Southwest Points + 1 Companion Pass
Chase United Explorer Personal

Chase United Explorer (Business)
$25,000 (Within 1 Calendar Year)1.89%$47335,000 United Miles
Chase United Club (Personal)

Chase United Club (Business)
$10,0001.89%$18915,000 United Miles
Chase British Airways$30,000 (Within 1 Calendar Year)1.89%$567 1 Travel Together Ticket + 37,500 British Airways Avios Points
American Express Premier Rewards Gold$30,000 (Within 1 Calendar Year)2.29% $687 45,000 Membership Rewards Points
American Express SPG (Personal)

American Express SPG (Business)
$20,000

$30,000 (Within 1 Calendar Year)
2.29%

2.29%
$458

$687
- 20,000 Starwood Points (Convertible to 25,000 Airline Miles)

- 30,000 Starwood Points + Starwood Gold Elite Status
Bank of America Virgin Atlantic$15,000
$25,000
(Within 1 Calendar Year)
2.29%$344

$573
- 30,000 Virgin Atlantic Miles (or 60,000 Hilton Hotel Points)

- 52,500 Virgin Atlantic Miles (or 105,000 Hilton Hotel Points)
American Express Delta Platinum & Reserve$55,000


$110,000


$170,000


$280,000
(Within 1 Calendar Year)
2.29%


2.29%


2.29%


2.29%
$1,260


$2,519


$3,893


$6,412
- 80,000 Delta Miles & Silver Status

- 160,000 Delta Miles & Gold Medallion Status

-250,000 Delta Miles & Platinum Medallion Status

- 410,000 Delta Miles & Diamond Medallion Status

But your needs will be different so choose the best option for you!

1.  DElta Debit Card – $3.49 for Up t0 35,00 Delta Miles

Link: Delta Debit Card

PayUSATax lets you pay your taxes using a debit card for a flat fee of only $3.49.  I made a tax payment in June 2012 using the Delta debit card and earned miles for my payment.

Note that the debit card has a transaction limit of $35,000 per day.  Also note that giving away thousands of miles for a $3.49 fee is almost certainly unprofitable for someone and that this could end without notice. 

Net Result:  Pay $3.49 in debit card convenience fees and earn up to 35,000 Delta miles (1 mile per $1 spent) for paying up to $35,000 in taxes in 1 transaction with the Delta personal debit card.

My Thoughts:  $3.49 for up to 35,000 Delta miles is a pretty good value, even if Delta miles are much harder to use than other types of miles and points.

2.   Citi Hilton REserve – $756 for 120,000 Hilton Points + Top Tier Hilton Diamond Status + 1 Free Weekend Night

Link:  Citi Hilton Reserve

Both the Citi Hilton Reserve and the American Express Surpass card let you earn Hilton Diamond status by spending $40,000 within 1 year, but the convenience fee for using an American Express card is more than for using a Visa/MasterCard.

Moreover, the Citi Hilton card does not have a foreign transaction fee, and gets you 1 free weekend night for spending $10,000 within a year.

With the 1.89% convenience fee from Pay USA Taxes for using a Visa/MasterCard, you’re effectively paying 0.63 cents per Hilton point for paying $40,000 in taxes in a calendar year with the Citi Hilton Reserve card.

Net Result:  Pay $756 in credit card convenience fees and earn 120,000 Hilton points (3 Hilton points per $1 spent) + top-tier Hilton Diamond status +1 free weekend night (which could be worth 50,000 Hilton points) for paying $40,000 in taxes within 1 calendar year.

But having the American Express  Hilton card, gets you access to discounted AXON awards, so the best option could be spending $40,000 on the Citi Hilton Reserve, but keeping a fee-free version of the American Express Hilton card to get access to the discounted AXON awards and stretch the value of your Hilton points.

My Thoughts:  This is the best credit card, in my opinion, to pay taxes with.  For $756 you get 120,000 Hilton points which is enough for 2 nights in a top category Hilton hotel and you get 20,000 points left over.

You also earn 1 free weekend night, so you’ve got at least 3 free nights in a top category Hilton AND you earn top tier Diamond status which means free breakfast, free internet, and a better shot at room upgrades.

Even if you redeem your 3 free nights for a room costing $200, you’re effectively paying an extra $156 for top-tier Hilton Diamond status.

3.   Chase Southwest – $2,079 for 110,000 Southwest Points & 1 Companion Pass

Link:  Chase Southwest Premier Card

Spend $110,000 within a calendar year on the Chase Southwest credit card and earn the Southwest Airlines Companion Pass, which lets you fly free with a companion, for up to 2 years.  This is by far the best perk of any airline in my opinion!

The Southwest Companion Pass is valid for the entire year in which you earn the 110,000 points necessary to get the Companion Pass, AND for the following year.  This means that you could get a Companion Pass for almost 2 years if you spend $110,000 in January on your Chase Southwest credit card.

Each Southwest Airline point is worth 1.67 cents when redeemed for Wanna Get Away flights, so spending $110,000 a year earns you $1,837 (110,000 points X 1.67 cents per point) worth of Wanna Get Away flights.

But if your companion flies with you for free, you’ve effectively earned twice that or at least 220,000 Southwest points or $3,674 ($1,837  X 2).

With the 1.89% convenience fee from Pay USA Taxes for using a Visa/MasterCard, you’re effectively paying 1.89 cents per Southwest point for the 1st $110,000 paid in taxes in a calendar year with the Southwest credit card.

But that’s like getting at least 220,000 Southwest points (when you redeem your 110,000 Southwest points) because your companion can fly free with you so you’re effectively paying only 0.95 cents per Southwest point.

Since each Southwest point can be used towards 1.67 cents of airfare, you’ve bought Southwest points for a 43% discount AFTER accounting for the 1.89% convenience fee.

Net Result:  Pay $2,079 in credit card convenience fees and earn 110,000 Southwest Points + 1 Companion Pass.  Earning the Companion Pass doubles the value of your 110,000 Southwest points.

And if you buy a Southwest ticket and fly a companion for free with your Southwest Companion Pass, your return will likely be higher.

My Thoughts:  I ranked this #3 instead of #2 only because spending $110,000 within a calendar year on taxes is tough to do.  But this is a great deal if you have $110,000 to pay in taxes and don’t mind flying Southwest Airlines.

Emily and I have used our Southwest Companion Pass way more than we expected to!

4.   Chase United Explorer personal and business credit cards – $473 for 35,000 United Miles

Link:  Chase United Explorer (Personal)

Link:  Chase United Explorer (Business)

The Chase United Explorer personal and business card gives you an extra 10,000 United miles when you spend $25,000 within one calendar year.

This means that you earn 35,000 United miles (25,000 miles for regular spending + 10,000 bonus miles) after spending $25,000 in a calendar year or a return of 1.4 miles per $1 spent on the card.

With the 1.89% convenience fee from Pay USA Taxes for using a Visa/MasterCard, you’re effectively paying  1.35 cents per United mile for the 1st $25,000 paid in taxes in a calendar year with the United Explorer cards.

Net Result:  Pay $473 in credit card convenience fees and earn 35,000 United miles for paying $25,000 in taxes within 1 calendar year.

My Thoughts:  It costs 25,000 miles for a low-level ticket within the US, so this isn’t a great deal for travel within the US, unless you use United miles for tickets to expensive destinations or for last minute travel.

But paying 1.35 cents per United mile could be a great deal for business or first class tickets to Europe or Asia.  For example, you’d pay only $1,350 for a business class ticket (subject to award availability) if you could buy 100,000 United miles at 1.35 cents per mile.

5.   Chase United Club personal and business credit cards – 1.5 miles per $1 spent

Link:  Chase United Club (Personal)

Link:  Chase United Club (Business)

If you’re a Big Spender who wants United miles, you may be better off with the United Club card which offers 1.5 United miles per $1 spent on the card with no limit on the maximum amount of miles earned.

With the 1.89% convenience fee from Pay USA Taxes, you’re effectively paying 1.26 cents per United mile (1.89 cents convenience fee / 1.5 United miles per $1 spent)  for ALL the tax you pay with the United Club cards.

The United Club card has a $395 annual fee, but does get you free access to United Clubs, 2 free bags, and waived late ticketing fees and Premier Access.

Net Result:  Pay 1.89 cents in credit card convenience fees and earn 1.5 United miles for paying $1 in taxes.  For example, you’ll pay $189 for a $10,000 tax payment, but will earn 15,000 United miles.

My Thoughts:  This is the best credit card to use for paying a large amount of taxes if you want to travel internationally in business or first class.  You pay only 1.26 cents per United mile, so a business class ticket to Europe or South America is only $1,260.

There is no limit to the amount of United miles you can earn with this card.  But the card has a $395 annual fee (which includes United lounge access), which is why I ranked it #5 and not #4.

6.   Chase British Airways credit card – $567 for 1 Travel Together Ticket & 37,500 Avois points

Link:  Chase British Airways

Spend $30,000 within 1 calendar year on the Chase British Airways credit card and earn a Travel Together Ticket which can be used for award reservations on British Airways operated flights only.

With the 1.89% convenience fee from Pay USA Taxes for using a Visa/MasterCard, you’re effectively paying 1.51 cents per British Airways Avios point for paying $30,000 in taxes in a calendar year with the British Airways credit card.

Net Result:  Pay $567 in credit card convenience fees and earn 1 Travel Together Ticket AND 37,500 British Airways points for paying $30,000 in taxes within 1 calendar year.

My Thoughts:  The Travel Together Ticket does have restrictions, but can be put to good use if you’re flexible.

Expect to pay ~$400 in fuel surcharges and taxes per long-haul segment on award bookings, but that’s still cheaper than paying for a business or first class ticket.  The companion pass is NOT worth it if you will be redeeming in coach because of the high fuel charges.

However, the United Club card (#5) is a much better option if you don’t want to pay high fuel surcharges on British Airways.

7.   American Express Premier Rewards Gold personal card – $689 for 45,000 Membership Rewards Points

Link:  American Express Premier Rewards Gold

  • 15,000 bonus Membership Rewards points when you spend $30,000 in 1 calendar year

This means that you earn a total of 45,000 points (30,000 for base spending + 15,000 bonus points) or 1.5 points per $1 spent for spending $30,000 within a calendar year.

With the 2.29% convenience fee from Value Tax Payment, you’re effectively paying  1.53 cents per Membership Rewards point for the 1st $30,000 paid in taxes in a calendar year with the American Express Premier Rewards Gold card.

Net Result:  Pay $687 in credit card convenience fees and earn 45,000 Membership Rewards points for paying $30,000 in taxes within 1 calendar year.

American Express Membership Rewards points can be transferred to many different airlines including Delta, British Airways, Aeroplan, & ANA and frequently have transfer bonuses, so your net cost could be lower.

My Thoughts:  1.53 cents for 1 Membership Rewards points seems expensive to me.  But you can transfer Membership Rewards points to other airlines and hotels, and American Express does have transfer bonuses to partners which make it more palatable to pay 1.53 cents for 1 Membership Rewards point.

8.   American Express Starwood Preferred Guest (SPG) – $458 for 25,000 Airline miles OR $687 for 30,000 SPG Points + SPG Gold Status

Link:  American Express SPG card (Personal)

Link:  American Express SPG card (Business)

• Earn an extra 5,000 points when you transfer in increments of 20,000 SPG points to many different airlines

This means that you earn 1.25 miles per $1 spent on the SPG card.  In many instances such as US Air, American Airlines, Alaska Airlines, this is a better earning rate than using the airlines’ own co-branded credit cards!

Airline Miles:  With the 2.29% convenience fee from Value Tax Payment, you’re effectively paying 1.83 cents per airline mile when you pay your taxes in increments of $20,000 with the American Express Starwood card and transfer 20,000 Starwood points to 25,000 airline miles.

Airline Miles – Net Result:  Pay $458 in credit card convenience fees and earn 20,000 Starwood points (convertible to 25,000 airline miles) for every $20,000 in taxes.

Airline Miles – My Thoughts:  Paying 1.83 cents per airline mile seems expensive, and isn’t worth it for most coach redemptions.

But this could be useful to transfer to American or US Air to top off for an award, or to transfer to Alaska Airlines, Singapore Airlines or other airline partners for international first and business class awards.

SPG Points & Gold Elite Status:  With the 2.29% convenience fee from Value Tax Payment, you’re effectively paying 2.29 cents per Starwood point when you pay $30,000 in taxes within a calendar year.

SPG Points & Gold Elite Status – Net Result:  Pay $687 in credit card convenience fees and earn 30,000 Starwood points & Starwood Gold elite status for spending $30,000 in taxes within  calendar year.

SPG Points & Gold Elite Status - My Thoughts: 30,000 SPG points will get you 3 nights at a category 4 Starwood hotel.  Gold elite status is good for 4 pm late check out and free internet, but not much else.

9.   Bank of America Virgin Atlantic credit card – $573 for 52,500 Virgin Atlantic Miles (Or 105,000 Hilton POints)

Link:  Bank of America Virgin Atlantic credit card

  • Earn 7,500 miles after spending $15,000 within a calendar year

This means that you can earn 30,000 Virgin Atlantic miles (22,500 miles for regular spending because you earn 1.5 miles per $1 spent + 7,500 bonus miles) after spending $15,000 in a calendar year or a return of 2 miles per $1 spent on the card.

With the 2.29% convenience fee from Value Tax Payment for using an American Express card, you’re effectively paying  1.15 cents per Virgin America point (or 0.58 per Hilton point) for the 1st $15,000 paid in taxes in a calendar year with the Bank of America Virgin Atlantic credit card.

Net Result :  Pay $344 in credit card convenience fees and earn 30,000 Virgin Atlantic miles (or 60,000 Hilton hotel points) for spending $15,000 in taxes within  calendar year.

  • Earn another 7,500 miles after spending $25,000 within a calendar year

This means that you can earn 52,500 Virgin Atlantic miles (37,500 miles for regular spending because you earn 1.5 miles per $1 spent + 15,000 bonus miles) after spending $25,000 in a calendar year or a return of 2.1 miles per $1 spent on the card.

With the 2.29% convenience fee from Value Tax Payment for using an American Express card, you’re effectively paying  1.09 cents per Virgin America point (or 0.55 per Hilton point) for the 1st $25,000 paid in taxes in a calendar year with the Bank of America Virgin Atlantic credit card.

Net Result :  Pay $573 in credit card convenience fees and earn 52,500 Virgin Atlantic miles (or 105,000 Hilton hotel points) for spending $25,000 in taxes within  calendar year.

Virgin Atlantic charges fuel surcharges for award flights, and there is a very stiff penalty (25% of the miles if cancelled outside of 7 days of departure or 100% of the award miles if cancelled within 7 days of departure) for cancelling award bookings.

But Virgin Atlantic miles could be useful for upgrading paid tickets on Virgin Atlantic or for transferring to Hilton, because you get 2 Hilton points for 1 Virgin Atlantic point.

My Thoughts:  This is the best card to actually earn Hilton points with since you pay 0.55 cents per point (up to $25,000 per calendar year) instead of 0.63 with the Citi Hilton Reserve.

But you don’t earn Hilton Diamond status or the free night with the Virgin Atlantic card, so I’d use this card only after spending $40,000 on the Citi Hilton Reserve.  And the difference in point earning may not be worth the annual fee.

 10.   American Express DElta Platinum & Reserve – Silver to Diamond Medallion Status & 80,000 to 410,000 Delta miles

I listed how to earn all levels of Delta Medallion status in an earlier post on earning airline elite status with a credit card.

Here’s the net result after paying a  2.29% convenience fee from Value Tax Payment,

  • $1,260 for Silver Medallion Status & 80,000 miles after spending $55,000 within 1 calendar year
  • $2,519 for Gold Medallion Status & 160,000 miles after spending $110,000 within 1 calendar year
  • $3,893 for Platinum Medallion Status & 250,000 miles after spending $170,000 within 1 calendar year
  • $6,412 for Diamond  Medallion Status Status & 410,000 miles after spending $280,000 within 1 calendar year

My Thoughts:  I don’t value airline elite status because I don’t fly on paid tickets very much, but this could be useful for folks who fly often and want to maintain Delta elite status.

Bottom Line:  Sometimes the extra miles and points could be worth the convenience fee to pay your taxes with a credit card.

But do the math for yourself to be sure you aren’t overpaying for the miles and points!

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34 Responses to The 10 Best Ways to Pay Your Taxes With Credit & Debit Cards

  1. Sometimes paying these big bills (ie, taxes) can help with another goal – meeting minimum spend requirements.

  2. Interesting post. I am a CPA and I advise all my clients to pay by one check. However, I am new to the points game and I will look at this more carefully. I appreciate the “my thoughts” on each credit card scenario. Great stuff.

  3. It appears you can only make two payments per quarter for all credit cards…I tried to make a third payment today with a different credit card and got the message that one acn only make 2 payments per quarter.

  4. Paul, look at the frequent miler’s post on this yesterday n you’ll see you can pay using another company.

  5. @FEV - That’s a great way to knock off the minimum spending requirement on some cards.

    @Lively – Please let us know if you can make more than 2 payments a quarter by using different service providers.

  6. I did try two different service providers – Pay USA Taxes and Value Tax Payment suggested here and would not allow me a third payment with a different credit card…Is there another provider I should try??

  7. I just found another payment site for taxes and that worked. So I was able to make more than two payments using different service providers.

  8. After looking at this and researching some other sources, It looks like the debit card with the 3.49 service fee is an awesome deal for a large quarterly payment (which is what I have due this week). Only problem is this– I don’t have the Delta Suntrust card and it would be very hard to apply for it and get the money in the bank before the 17th when the payment is due. I have the credit line on many of my credit cards but I don’t feel like it is worth the fee. I was able to charge some other state taxes this last week without paying any fees and earned lots of points. Thrilled that this worked.

  9. You can absolutely make more than two card payments per quarter. I do almost every quarter. The reason it didnt work when trying Pay usatax and value tax payments is that they are both owned by h and r block. You would need to use official payments to make two more payments. There was also one quarter a couple of years ago when i made two payments with valuetaxpayments and two payments with officialpayments and then called official payments on the phone and they pushed through a third payment foe me for a total of five credit card payments in one quarter.

  10. @Paul – Please let us know if all goes smoothly!

    @Kathy - I don’t think you’ll get the card by the 17th either. However, keep in mind that this worked for me in June, and it could change anytime.

    @Brant Jackson – Thanks so much for sharing your experience. Very nice to know that you were able to make more than 2 payments per quarter.

  11. You should consider adding the Priceline Rewards Visa. 2% back on everything, plus a bonus (up to 1.5%) when points are redeemed against priceline “name your own price” purchases. If you use priceline a lot (I do for work) this is a great deal.

  12. @Dave – Thanks for the tip. I’ll take a look at the card – the extra 1.5% kicker sounds great!

  13. Everything went smoothly using a different service provider!!

  14. I have to pay property taxes in November (~$5K). Our county accepts credit/debit cards, but they impose ~3% fee, so it is not worth it. I was wondering, if MOs would work for this purpose. Our WM charges only 1 penny for it, so it is very tempting. I think it is a legitimate reason for ST, right?

  15. @Paul - Thanks for the update!

    @Sergey - You could pay with a Money order, but risk having your account closed. WalMart charges 70 cents per money order. You could buy gift cards with a Chase Ink Bold or Ink Plus at an Office Supply store for 5X points, and you’d still earn ~1X points after paying the gift card fee and visa card activation fee.

  16. Hi Daraius. My wife and I pay a significant amount of taxes year (personal, business, and property). I am usually against paying credit card “conveinence fees” but just paid 30k estimated taxes using Chase BA to get the Avios points and travel together ticket. My reasoning is that even after 1.89% fee, I am still ahead. However, 30k is only part of my taxes! I am looking into SunTrust Delta (35k limit per day, but I figure I can do 2 transactions per quarter for total of 280k miles per year (4 estimated tax payments total), while paying minimal fees. Also thinking about parking some money in Bank Direct AA account (and writing checks when tax time comes). Finally, am
    thinking about buying/accumulating Visa gift/debit cards with Ink Bold and earning as much UR points as possible (I think frequent miler mentioned that one tax payment service allows many visa debit card payment, and not just two per quarter). Without sign on bonuses, most credit cards are just not worth the fees. Any other recommendations?

    Thank you!

  17. SP, My husband and I pay alot of taxes too. It stinks but I would atleast like to benefit and get the maximum miles. Our state allows us to use a credit card without a fee for our state taxes. This is awesome. The problem is the federal taxes. I am looking for a debit card to pay the federal taxes. I thought about getting the debit cards through Office Depot with the Ink Bold but don’t want to pay to pay a fee for every $500 card. The fee will add up since I have to get so many. Also, I don’t want to create a “red flag” with chase and buy too many cards and get shut down. I am misunderstanding debit card concept?

  18. @SP @Kathy – You may be able to do more than 2 transactions per quarter by using different service providers or calling them, but I believe the spirit of the IRS rule is no more than 2 per quarter. That said it is kind of silly to put a restriction on how taxpayers pay there tax bills. The Suntrust Delta debit card deal could stop anytime since giving away so many miles is likely unprofitable for such a small fee.

    Buying prepaid gift cards from Office Supply stores with the Ink Bold/Plus and then paying taxes is profitable – even after the fees. But the $500 limit is a pain for large payments. For large payments the Chase United Club card is the best since you earn 1.5 miles per $1 spent, so you’re effectively paying 1.26 cents per United mile after the fees.

  19. Hi Kathy. Frequent Miler has a recent thread where he called one of the authorized companies paying federal taxes and was able to use many visa debit cards. This particular company will process as many payment via phone only. He stated he also called IRS and they are not aware of any hard rules limiting credit/debit cards at 2 per quarter. At the very least, you can call up multiple providers and make 2 payments each. A bit tedious but at least you will get Ultimate Reward points out of it rather than nothing at all.

    When buying $500 (maximum value) visa debit cards from an office supply store on Chase Ink Bold, you will get 5 UR points per dollar. The fee to acitvate is around $6 and when paying taxes, each debit card is a “separate transaction” that incurs a fee ranging from $3.50 to $4.00 (based on which service). So your total fees for paying $500.00 taxes is about $10.oo, or 2%. Since you earned 5% back in UR points, you end up 3% ahead (and much more if you redeem UR for say, Hyatt, and stay at their ultra high-end places, such as Park Hyatt in Paris. This place is 22000 points per night on points, but can easily cost $1000.00 per night if paying cash). To pay all my taxes, I would need hundreds of debit cards per year, which would not be practical (I would need multiple Chase Ink Bold cards, and an endless supply of Visa debit cards at Office Depot…not to mention my Chase accounts will get cancelled in heartbeat!)

    To prepare for this, I have transferred all monthly autopay to my Ink Bold (does not hurt since cell phone and cable TV gets 5 UR points as well), and have made it our default card. My plan is not to buy $50k worth of Visa debit cards per year (though the thought of 250k UR points is VERY tempting), but just to buy a few a month, accumulate, and perhapes use 10-20 per quarter. I will not be able to get points for EVERY penny of taxes paid, but am just looking to get some of it back (and again, not to incur the wrath of Chase)! If this works out well, I may then increase number of cards used and look into multiple Ink Bolds. I dont want to get too greedy too early/fast and risk Chase shutting us down.

    I think this route is the most lucrative, netting 3%. Though Delta debit card has lower fees (only 1 service charge per $35k taxes paid…you are getting one mile per dollar/1% net)….the same with Bank Direct for AA miles. I would love to maximze using Ink bold, but since there are limitations to all three methods, I am looking to combine them and maximiz my points/mile.

    Hope this helps!

  20. SP-I like all your ideas. My husband and I both have Ink Bold accounts so I can get cards under each of our accounts. Which visa debit card do you use at office depot? Netspend?

  21. Hi Kathy. I am thinking of Vanilla Visa (not the reload version). I mentioned Office Depot since they are the only ones carrying them. I would think any Visa card would work (as long as max denomination…whichs seems to be $500.00). I am planning to visit Stapes/Office Max to see what other options are out there. There are thread talking about using Vanilla reloads to put $2500.00 on AMEX prepaid cards. Problem here is that AMEX is treated as credit cards by tax agencies, and will incur approx 2-2.5% service charge (on top of your activation fees) and not the $3-4 fee for Visa (which counts as debit cards).

    There are many threads about Chase shutting down accounts for “perk abuse”, so please read them before proceeding (Daraius has one on this site).

    Am planning to purchase a few cards either today or tomorrow and try to pay 9/17 estimated taxes to see how it goes. If smoothly, then plan to purchase a few a month, so that can use more on the property taxes due later this year and estimated taxes 1/15.

  22. @SP – You could get a Chase Ink Plus or the Ink Cash/Classic for you and your wife if you really wanted to max out on debit cards. But I don’t think it is practical to buy hundreds of cards and pay taxes with them. Please let me know if you are successful paying with 20 cards a quarter. I believe Frequent Miler wrote “He had certainly never heard of anyone getting in trouble for doing so. It wasn’t exactly a ringing endorsement for this approach, but it does help give it a little cover.” So be a bit cautious and do let us know how it goes!

  23. Hi Kathy and Dararius. So I went out yesterday and bought some $500.00 Vanilla Visa cards from Office Depot. Also stopped by Staples by their maximum denomination is $200. The Vanilla cards also has activation fee of $4.95, vs %6.95 at Staples. Make sure you go to Vanilla website, input card info, and update it with your zip code. Official Payments asks for your zip and uses that to verify the debit cards. If you dont attach a zip to it, the transaction will get declined!

    If you don’t care about making a $0.05 donation to IRS, buy $500.00 on each card. If you want to keep the nickle, put $499.95 on the cards (OP charges $3.95 per debit card to use, so if you use a $500 debit card, your payment to IRS is $496.05…whereas if your card totaled $499.95, then its $496 to IRS and $3.95 to OP).

    No real issues at Office Depot, though they did have to bring out a manager for any transaction over $1000.00. I suspect I will travel to different OD in my area to do this.

    Just called OP and made 5 debit card payments of $496.05+$3.95 and they all went through!

    I see plenty of trips to Office Depot (and hopefully a trip to Park Hyatt Venodome in Paris) in the future!!!

  24. MMS-I don’t have to make estimated payments, but I really want to pay all my taxes with a credit card because I have companion pass and the points are worth MUCH more to me than the 1.89% fee. I have been searching high and low for the rules on taking NO withholding and just making quarterly tax payments. Any info?

  25. @SP – Congrats and thanks for sharing! I’ve heard that you can call to get around the 2 payments per quarter limit.

    @Joshua - You can do that, but be careful to calculate your payments accurately and make them on time. I’d also talk with your accountant before making the change.

  26. I have no doubt that my payments will be accurate because my pay doesn’t change that much. Just wanting to find yet another edge to meet those minimum spends and earn more SW points.

  27. Will the UFB Direct debit card work for the $3.95 fee? I know it is only 1/2 a mile per dollar, but I’m not greedy. I will take half an AA mile.

  28. Getting ready to make a large quarterly payment due on the 15th (almost $9000) My head is spinning after reading this. Just trying to decide which card to use, etc. SP, have you made any payments since your last post.

  29. @Susan – It worked in my test, but your miles may vary.

    @Kathy – Just use whichever card you have that’s on the list or which you want to complete the minimum spending for. If you don’t have any of these cards, use a regular card – you’d still earn the miles and points or cash back.

  30. Hello MillionMileSecrets, this is a great post! I wish I had read it earlier. Is the SunTrust debt card deal (say I pay $50,000 taxes with a $3.95 flat fee and get 50,000 Delta miles) still alive? Does SunTrust impose any daily/monthly/annual cap on the amount of Delta miles one can earn on his or her debt card? Thanks in advance.

  31. @WT – I believe there is a daily limit with the Delta Suntrust card and you still get miles for the payment. But I’d call Suntrust before and let them know of the large charge so that it doesn’t get declined.

  32. Hey Daraius,
    I am a long time reader and subscriber. I probably don’t maximize as much as possible, but my office has just relocated to China and now it’s pretty important that I travel business for the long haul flights as much as possible. Hence I need to get as many points as possible.
    Can I use my Chase Ink Bold to make quarterly payments for my taxes? I didn’t see anything mentioned above about that. And is there a limit? I have a quarterly tax bil of approximately 50K. If I could just pay with my Ink Bold, then I would be able to make a couple roundtrip business class tickets each year. Thanks for any help.

  33. @Jeremy – Thanks for reading! You can use your Chase Ink card to make payments as well. I didn’t include the Chase Sapphire Preferred or the Ink Bold cards because you will only earn 1 point per $1 spent, whereas the cards in the post give you a multiplier or additional points/miles for spending. If you do 50K a quarter, the United Club card which gives you 1.5 miles per $1 spent could be worth a look.

  34. Pingback: How to See if Your Credit, Debit, & Gift Card Tax Payments Are Received by the IRS | Million Mile Secrets

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