What’s the best credit card to pay taxes?
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
Update: Some offers mentioned below are no longer available. View the current offers here – Capital One Venture Rewards Credit Card
Editor’s note: This post has been updated with new information.
Heads up: Taxes are due this Monday, May 17. For some, this means a sizable refund, while others will realize that they owe the government a good chunk of change. If you’re having to pay up this tax season, you may wonder which card to use to pay your taxes.
For more TPG news delivered each morning to your inbox, sign up for our daily newsletter.
While a big tax payment can be a great way to rack up bonus miles, you’ll want to make sure you’re earning enough to offset the processing fee that’s charged when you pay taxes with a credit card. There are a number of different IRS-approved payment websites you can use, but if you plan to pay with your credit card, you’ll want to use payUSAtax.com.
This site charges the lowest credit card processing fee at 1.96% with a minimum charge of $2.69. Although this site isn’t especially high-tech, I’ve been using it to make quarterly estimated tax payments and have never run into any problems.
Related: Paying taxes with your credit card
When trying to decide which credit card to use, it’s important to note that there aren’t any bonus categories that cover tax payments. This means you’ll want to pick a card with a high return on everyday spending, like The Blue Business® Plus Credit Card from American Express or the Capital One Venture Rewards Credit Card. The Blue Business Plus card earns 2x Membership Rewards points per dollar on your first $50,000 spent each calendar year (1x after that), and the Capital One Venture earns unlimited 2x miles on all purchases. Based on TPG’s valuations, that works out to a 4% and 3.4% return, respectively, meaning you’ll come out ahead even after paying the 1.96% processing fee.
Right now, the Capital One Venture is offering an all-time high sign-up bonus of up to 100,000 miles. You’ll earn 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months. Depending on how large your tax payment is, paying with this card will also help you reach the minimum spend requirement for the sign-up bonus.
Another option might be to use The Business Platinum Card® from American Express, which offers a 50% bonus on purchases more than $5,000 (up to 1 million additional points per calendar year). The card would normally earn 1x American Express Membership Rewards points per dollar when paying your taxes, but this bonus brings your earn rate up to 1.5x (a 3% return based on TPG’s valuations). Just note that PayUSAtax charges you separately for your tax payment and the processing fee, so you’d want to make sure you were actually making a tax payment of $5,000 (or greater) in order to get your bonus points.
While taxes represent a pretty large expense for many individuals, there aren’t many tricks to earn extra bonus points. You can use this expense to meet the sign-up bonus on a new card or to meet an annual spending requirement for extra perks but short of that you’re best off sticking with a card that offers a good return on everyday spending.
Additional reporting by Stella Shon
Featured photo by Isabelle Raphael/The Points Guy.
Welcome to The Points Guy!
Earn 90,000 bonus miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new card in the first three months of card membership. Offer ends 11/10/2021.
With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.
- Limited Time Offer: Earn 90,000 Bonus Miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new Card in your first 3 months. Offer expires 11/10/2021.
- Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
- Earn 3X Miles on Delta purchases and purchases made directly with hotels.
- Earn 2X Miles at restaurants worldwide, including takeout and delivery and at U.S. supermarkets.
- Earn 1X Miles on all other eligible purchases.
- Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. *Payment of the government imposed taxes and fees of no more than $75 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
- Enjoy your first checked bag free on Delta flights.
- Fee Credit for Global Entry or TSA Pre✓®.
- Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees