Can You Pay Your Taxes With a Credit Card?

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The short answer is yes: You can pay federal taxes and taxes on some states with a credit card. What you should do, however, depends on your financial situation and goals. Let’s cover:

  • How to pay taxes with credit card
  • Advantages and Disadvantages of Paying Taxes with Credit Card
  • Other Ways to Pay Taxes by Credit
  • Tips for Paying Taxes by Credit Card

How to pay taxes with credit card

IRS website There’s a good place to pay your federal taxes – just follow the directions on the site. Expect to enter your taxpayer information and credit card information. To pay your state taxes, visit your state’s website.

If you use a third-party tax preparation software or website to file your taxes, a credit card may be acceptable for payment. While this is a convenient way to prepare your tax return, e-file fees can be high. There are also tax return preparers who work in brick-and-mortar agencies if you’d rather work with someone in person. Credit cards are one of several payment methods that a tax preparer can accept.

Advantages and Disadvantages of Paying Taxes with Credit Card


  • Facility: Paying taxes online can be a fast process, and you get an automatic confirmation when your payment is received.
  • More time for payment: Using a credit card to pay your tax bill will add it to your credit card balance, which you are able to pay overtime. You are responsible for paying the minimum amount due on your Credit Card each month and not the entire balance. You can save time as well as the money you pay. For example, paying your taxes on a credit card with an introductory APR—which may charge no interest—gives you time to pay it off over an introductory period.
  • Sign-up Bonus Minimum: Sign-up bonus offers usually require you to spend a high dollar amount before the rewards or points are awarded. Paying your taxes with a credit card can be worthwhile if the amount of the tax bill will help you meet the bonus offer requirement. However, the interest will likely offset the bonus if you don’t pay your dues in full every month.
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  • facility fee: The IRS will not accept credit card payments directly. It works with payment processors that accept credit card payments. Each processor on the IRS website charges a convenience fee that varies slightly depending on the processor. The fee area is 2% of the tax amount being charged to your credit card. You choose which processor you want to use before sending the payment.
  • Credit Effect: Large purchases on your card add up to your credit card balance. Carrying a high balance from month to month affects your credit utilization ratio, the percentage of your available credit that you use. If this ratio goes above 30%, your credit score can take a hit.
  • Some Awards: Cash back rewards cards can offer up to 2% cash back on non-category purchases (taxes will be included). Those earnings can be canceled out by the processing fee you pay while using your credit card for your tax bill.
  • high interest: Paying your tax bill with a credit card is similar to making any other purchase with your credit card. If you make only the minimum payment every month, interest will be charged on your unpaid balance.

Other Ways to Pay Taxes by Credit

feature check

Convenience checks are a form of payment that gives borrowers an additional way to access credit. When you use convenience checking, the amount spent is deducted from your credit limit as a cash advance. Keep in mind that its APR may differ from your standard purchase APR.


irs payment plan

IRS payment plans may allow you to pay your taxes over time without affecting your credit score. There are two options:

  • Short Term Payment Plan: This is the plan for you if you can pay within 120 days, and you owe $100,000 or less in combined penalties, taxes, and interest.
  • Long Term Payment Plan: This plan is for you if you know it will take you more than 120 days to pay it off, and you owe $50,000 or less in combined penalties, taxes, and interest.
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Each scheme charges interest and fees, so go to IRS website for the latest information.

Credit Card Payment Tips

Here are some strategies if you plan to pay your taxes with a credit card:

balance transfer card

Consider paying your tax bill with a balance transfer credit card. Balance transfer cards help you transfer balances from a higher-interest card to a lower-interest card. They usually have promotional APR terms available for individuals with good credit and offer lower APRs for paying down high balances. Just be sure you’re able to pay off the credit card by the end of the promotional period and before the interest rate increases.

check your rewards

Before you use the card to earn rewards on your tax payments, double-check to see what you’ll be earning. This is true whether you want to use an existing card or apply for a new one that offers a strong sign-up bonus. Remember: You want to be able to earn enough rewards with the credit card to help offset any fees charged to pay your tax bill.

Should I Pay My Taxes With a Credit Card?

If the processing fee exceeds the rewards you can earn, it probably isn’t worthwhile paying your taxes with a credit card. However, if you value the convenience of using a credit card or find the signup bonus offer attractive, consider using your card. Tax bills can be costly, and so can interest charges if they add up. Your financial health depends on using your credit card effectively.


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