Is it possible to pay taxes with a credit card

If you pay with a credit card that offers a lower percentage of rewards than the fee, it doesn't really make sense to use a credit card. If you use a credit card to pay taxes, it's key to pay your balance in full by the due date to avoid interest charges. Otherwise, you can risk debt and high interest charges if you only make the minimum payment and carry a balance month-to-month. And if you pay with a credit card, you won't be able to take advantage of any payment plans offered by the IRS.

Paying taxes with a credit card can have a negative impact on your credit score. Charging high tax payments to a credit card can cause a spike in your credit utilization rate, which is the total percentage of your credit you use. To calculate your utilization rate, simply divide your total credit card balance by your total available credit.

Credit score calculations weigh your credit utilization rate and it's ideal to keep it as low as possible. While many tax payments can be made with a credit card, such as your annual tax return, not all IRS tax forms are eligible. Now that you know the pros and cons of paying taxes with a credit card, you can decide if it's a worthwhile payment option. If your credit card rewards or welcome bonus offer outweigh the processing fee, a credit card payment can be an option.

Skip Navigation. Follow Select. Our top picks of timely offers from our partners More details. SoFi Personal Loans. LightStream Personal Loans. We may receive a commission from affiliate partner links. Click here to read more about Select. Click here to read our full advertiser disclosure.

We do not give investment advice or encourage you to adopt a certain investment strategy. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team. Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

Disclosure: This post may highlight financial products and services that can help you make smarter decisions with your money. What you decide to do with your money is up to you. For you. World globe An icon of the world globe, indicating different international options.

Get the Insider App. Click here to learn more. A leading-edge research firm focused on digital transformation. Good Subscriber Account active since Shortcuts. Account icon An icon in the shape of a person's head and shoulders. It often indicates a user profile.

Log out. More Button Icon Circle with three vertical dots. It indicates a way to see more nav menu items inside the site menu by triggering the side menu to open and close. Credit Cards Credit card reviews. Best credit cards Best rewards credit cards. Best cash back credit cards. Best airline credit cards.

Best small business credit cards. Best balance transfer cards. Best student credit cards. Best starter credit cards. The best online brokerages for beginners. The best investment apps. The best stock trading apps. Best robo advisors. Average stock market return. Car insurance. Life insurance. Best cheap car insurance. Best life insurance companies. Best homeowners insurance. The best renters insurance. Average cost of car insurance. Average cost of life insurance. Average cost of home insurance.

How to shop for car insurance. Best savings accounts. Best checking accounts. Best CD rates. Best money-market accounts. Best high-yield savings accounts.

Best bank account bonuses. Best online bank. American Express Savings review. Average bank interest rates. Average k balance. Finding out that you owe a significant amount of money in taxes can be surprising news to digest. Tax season doesn't have to be stressful as long as you have a plan in place for how you will file your taxes and pay your tax bill.

Money may be tight, so perhaps you're wondering if it makes sense to use a credit card to pay your taxes. Keep reading to find out if this is a good choice for you. Yes, it's possible to pay your federal taxes with a credit card.

But should you? Be aware of extra fees you'll have to pay when you use your credit card for tax payments. Knowing how much you'll pay ahead of time can help you make a more informed decision. No matter how you use your credit card to pay your taxes, you'll be charged a fee. If you use one of the third-party payment processors that the IRS recommends, you'll be charged fees.

If you file your taxes through an online tax preparation company and make a credit card payment directly through them, you'll also be charged fees. For either situation above, the total fee you'll pay is calculated as a percentage of the amount paid.

There is also usually a minimum fee in place. Fees vary depending on the payment processor or tax preparation company you use. Be sure to look into these costs before using a credit card to pay your taxes so you can avoid unexpected charges. There's no workaround to avoid paying credit card fees when paying your taxes with a credit card. You'll need to decide if it's worth the fees to use your card. The best way to avoid paying extra fees is to make a payment with funds directly from your bank account.

It may make sense to pay your taxes with a credit card. Here are some examples. If you recently opened a top credit card that requires a minimum spend to earn bonus points, it may be smart to use your credit card to pay your taxes.

With that being said, it's essential to consider whether the bonus points outweigh the fees that are charged. If you're going to have to pay hundreds of dollars in fees, it probably isn't a good plan. Depending on the credit card you have and the earning potential it offers, you may decide to pay your taxes with a rewards credit card to earn additional points or rewards.

Just make sure that the math makes sense.