Paying my taxes with a credit card

I had no idea paying taxes with cc was an option

Yeah they charge a fee, quite a hefty one actually, like 2.29%. But the credit card I applied for I'll get a good bit in rewards towards airfare or hotels with the amount I'm spending, so it will cancel it out and then some. Basically I'll get a free plane ticket out of the deal.

The IRS will take your card but will charge a hefty fee. You might be better off paying from savings, then charge daily expenses on the credit card until you hit the limit. Just save up for the big payoff after 12 months.

Of course, you could do that whether you are paying the IRS or not.

I would only do it if you get a sign up bonus for the new card.... Or if I have a card where I need to hit a spending threshold for a bonus or waived fee

quote:

---

The IRS will take your card but will charge a hefty fee. You might be better off paying from savings

---

Like I said, I did the math and even with the 2.4 % fee I'll come out on top considering the promotion I get from the credit.card spending x amount of dollars in the first few moths. I'll basically get a free plane ticket despite the fee I will pay.

So this amounts to an after the fact plan for 2012 ? You could have accomplished the same think without the fee or the miles, if you would have made the correct deposits.
What your plan for 2013 ?

Bet you have a balance from 2012 when you file for 2013.

If you are self employed then you must have a business of some sort right? Plumber, accountant, etc? Why aren't you writing yourself a check from your business to pay your taxes? I have to pay quarterly and write myself a check and call it a distribution since I have an S corp. If your business has no cash, then you may have bigger problems. Paying taxes on a cc seems very desperate to me. What am I missing here?

quote:

---

Like I said, I did the math and even with the 2.4 % fee I'll come out on top considering the promotion I get from the credit.card spending x amount of dollars in the first few moths. I'll basically get a free plane ticket despite the fee I will pay.

---

You realize you can do this anytime of the year? This maneuver has nothing to do with taxes, it's just charging today's expenses and making sure you can pay back after 12 months.

There's no real reason to pay the extra fee.

You can put a month or two worth of expenses on your credit card and not pay the fee though

You might want to try this. Pay with credit card and when the statement comes in pay 1/2 out of savings and pay the balance as soon as you can. You should pay estimates. Estimates should cover the tax due this year. However not to kill your cash flow pay 1/2 of the required amount. This will leave you a smaller balance due next filing season. Then in 2014 increase to 3/4 of the required amount and the full amount in 2015. It will take several years to get into a position of taking care of your financial oblation with less sting on your cash flow. Because cash flow is king in a self-employed business. The penalty for underestimating is not that high. Good Luck.