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If you won’t be getting a tax refund this year, you can still possibly get something out of paying your taxes. Using some of the best credit cards for paying your taxes can be a rewarding way to get a tax refund alternative by earning rewards points/miles and enhance credit card bonuses that can earn even more rewards.
However, the rewards have to justify the processing fee for using your travel credit card.
Although any credit card will pay your taxes, the rewards need to be greater than the additional processing fees you will pay. The IRS won’t collect a penny of the credit card processing fees, but the three payment processors that partner with the IRS will.
Terms apply to American Express benefits and offers. Visit americanexpress.com to learn more.
The federal 2020 tax filing deadline is May 17, 2021. If you need to file a state tax return, that filing deadline might be the same date (or later). If you have to “pay in” this year, you can make your payments interest-free.
Making any payments after the May 17 deadline is subject to additional interest and penalties that can erase any additional rewards after you pay the processing fee. Whether you pay your taxes by credit or not, file your return by end of day May 17 to ensure you don’t get hit with any surprise fees.
The Best Credit Cards for Paying Taxes: Consumer Cards
While many people think that the best time to apply for a new travel credit card is when they book their summer vacation or open their wallet for holiday travel and gifts, tax time can be just as rewarding.
Before you pay your taxes with just any run-of-the-mill credit card, you need to look at two important factors:
- Purchase Rewards
- Sign-Up or Welcome Bonus Value
Each point you earn must be worth at least 2 cents each ($0.02) to offset the payment processing fees. The sign-up/welcome bonus can make up the difference.
If using a credit card to pay your taxes is the difference between receiving a sign-up bonus or not, paying a 2% processing fee is well worth it to get a mountain of bonus points in return.
Chase Sapphire Preferred Card
Bonus Offer: New Chase Sapphire Preferred® Card cardholders can earn 100,000 bonus points after spending $4,000 on purchases in the first 3 months from account opening, worth $1250 when redeemed through Chase Ultimate Rewards®. This is the highest bonus offer ever for the Chase Sapphire Preferred!
The Chase Sapphire Preferred Card is a go-to favorite for travelers that want flexible travel rewards without a steep annual fee. Here are three main reasons beyond the sign-up bonus to consider the Chase Sapphire Preferred Card:
- 1:1 Chase travel partners including United, Southwest Airlines, Hyatt, and Marriott
- 25% travel redemption bonus when booking award travel through Chase Ultimate Rewards
- Cardholders also earn 5x points on Lyft rides, through March 2022.
By transferring your Ultimate Rewards points to your favorite frequent flyer program, you can easily make each point worth at least 2 cents each—the sweet spot to cancel out the processing fees on your tax bill.
Also, enjoy new Chase Sapphire benefits such as a $50 annual Ultimate Rewards Hotel Credit, 5x points on travel purchased through Chase Ultimate Rewards®, 3x points on dining, and 2x points on all other travel purchases, plus more.
Additional Chase Sapphire Perks
Additional Chase Sapphire Preferred benefits include unlimited deliveries with no delivery fee and reduced service fees on orders over $12 for a minimum of one year on qualifying food purchases with a DoorDash DashPass subscription. Activate your card by December 31, 2021.
Plus, cardholders can earn up to $60 in statement credits on Peloton Digital and All-Access Memberships through December 31, 2021. Points are worth 25% more now through September 30, 2021, when redeemed for statement credits against existing purchases in select, rotating categories with the Chase Pay Yourself Back feature. Points are also worth 25% more when redeemed through the new Chase Dining hub in Ultimate Rewards, now through September 30, 2021.
The annual fee is $95.
Chase Sapphire Reserve
Bonus Offer: 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $900 toward travel when you redeem through Chase Ultimate Rewards®
If you prefer benefits like lounge access, travel credits, and more, this premium card might be perfect for you. Frequent flyers looking for more than 1:1 point transfers can find more value out of the Chase Sapphire Reserve®.
You will enjoy the following travel benefits with the Chase Sapphire Reserve:
- Global Entry application fee reimbursement
- Priority Pass Select membership
- 50% travel redemption bonus
- 1:1 Chase travel partners
- $300 annual travel credit
Plus, earn 5x total points on air travel and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases.
Gas station and grocery store purchases will also count towards earning the annual $300 travel credit, through December 31, 2021.
Additional Sapphire Reserve Benefits
Cardholders can also earn up to $120 in statement credits on Peloton Digital and All-Access Memberships through December 31, 2021. This is in addition to the complimentary DoorDash DashPass subscription that lets cardholders get unlimited deliveries with a $0 delivery fee and reduced service fees. They also earn up to $120 in statement credits on DoorDash purchases ($60 in statement credits through 2020 and another $60 in statement credits through 2021).
Sapphire Reserve cardholders earn 10x points on Lyft rides, including bikes and scooters. Complimentary Lyft Pink Membership is also available when activated by March 21, 2022. Points are worth 50% more through September 30, 2021, when redeemed for statement credits against existing purchases in select, rotating categories with the Chase Pay Yourself Back feature. Points are also worth 50% more when redeemed through the Chase Dining hub in Ultimate Rewards, now through September 30, 2021.
The additional Sapphire Reserve benefits can easily offset the $550 annual fee if you fly on a regular basis. And you get full access to the 1:1 Chase airline and hotel travel partners too.
You can view our Chase Sapphire Preferred vs Sapphire Reserve Review for comparison if you are torn between the two cards.
The Platinum Card from American Express
Welcome Offer: New The Platinum Card® from American Express cardmembers can earn 100,000 Membership Rewards® Points after spending $6,000 on purchases on the Card in the first 6 months of Card Membership. New cardholders also earn 10x points on eligible purchases on the Card at restaurants worldwide and when you Shop Small in the U.S., on up to $25,000 in combined purchases, during your first 6 months of Card Membership. Terms apply.
If you think the Chase Sapphire Reserve is rich with amenities, take a look at The Platinum Card® from American Express:
- Up to $200 air travel credit (in the form of a statement credit; enrollment required)
- Up to $200 Uber credits (terms apply; enrollment required)
- Complimentary access to the Global Lounge Collection
- Global Entry or TSA PreCheck fee reimbursement
- 1:1 travel partners
Earn 5x Membership Rewards® Points for flights booked directly with airlines or with American Express Travel, up to $500,000 on these purchases per calendar year. Cardholders also earn 5x points on prepaid hotel bookings through amextravel.com.
The Amex Platinum earns Membership Rewards that can be transferred directly to Delta, Emirates, and Etihad to name a few of the 1:1 travel partners. Frequent flyers will benefit most from this premium travel rewards card.
Cardholders can get $200 back in statement credits each year on prepaid Fine Hotels + Resorts® or The Hotel Collection bookings with American Express Travel when paying with their Platinum Card®.
If you ride Uber or use Uber Eats, this credit will make you happy. Cardholders can enjoy Uber VIP status and up to $200 in Uber savings on rides or eats orders in the US annually. Uber Cash and Uber VIP status available to Basic Card Member only.
Plus, American Express has expanded The Centurion® Network to include 40+ Centurion Lounge and Studio locations worldwide. Now there are even more places your Platinum Card® can get you complimentary entry and exclusive perks.
Terms apply. Enrollment may be required.
New The Platinum Card from American Express Benefits
There’s also a new digital entertainment credit. Cardholders can get up to $20 in statement credits each month when you pay for eligible purchases with the Platinum Card® at your choice of one or more of the following providers: Peacock, Audible, SiriusXM, and The New York Times. Enrollment required.
In addition to enjoying TSA PreCheck or Global Entry access, cardholders can also enjoy CLEAR perks. Cardholders can use their Card and get up to $179 back per year on their CLEAR® membership. Terms apply.
Another exciting new benefit is the ability for cardholders to enjoy up to $25 back each month on select Equinox memberships. This amounts to up to $300 annually. Enrollment required.
Additionally, cardholders can get up to $100 in statement credits annually for purchases at Saks Fifth Avenue on The Platinum Card® from American Express. That’s up to $50 in statement credits semi-annually. However, they must be enrolled for this benefit to apply.
The annual fee is $695 (See Rates & Fees) but can be offset with the perks, which are valued at over $1,400.
The Amex Platinum Card is worth the annual fee, assuming the cardholder can use and benefit from the extras that come with this card.
Learn more: Johnny Jet Recommended Credit Cards
Hilton Honors American Express Surpass Card
Welcome Offer: Up to 180,000 points!
New The Hilton Honors American Express Surpass® Card cardholders have the ability to earn up to 180,000 bonus points! New cardholders can earn 130,000 Hilton Honors Bonus Points after spending $2,000 in purchases on the Hilton Honors American Express Surpass Card in the first 3 months of Card Membership. Plus, earn an additional 50,000 Hilton Honors Bonus Points after you spend a total of $10,000 in purchases on the Card in the first 6 months.
The annual fee is $95 (See Rates & Fees).
Learn more: Hotel Rewards Credit Cards
The Hilton Honors American Express Surpass® Card made the list due to its enhanced welcome bonus that, if earned, can set you up with several free nights. Cardholders can also earn a Weekend Night Reward from Hilton Honors after spending $15,000 on purchases on their Card in a calendar year.
- 12x points for each dollar of eligible purchases charged on your Card directly with a hotel or resort within the Hilton portfolio
- 6x points for each dollar of eligible purchases on your Card at U.S. restaurants, at U.S. supermarkets, and at U.S. gas stations
- 3x points for all other eligible purchases on your Card
If cardholders spend $40,000 on eligible purchases on their Card in a calendar year, they can earn Hilton Honors Diamond status through the end of the next calendar year.
If you stay at Hilton Hotels often, this might be the best option for you. However, you can compare the other Hilton co-brand cards in our review of the best Hilton credit cards.
Learn More: Hotel Rewards Credit Cards
Capital One Venture Rewards Credit Card
Sign-Up Bonus Offer: Earn 60,000 miles if you spend $3,000 on purchases in the first 3 months
The Capital One Venture Rewards Credit Card earns unlimited 2x miles on every purchase, making it easy to earn miles. Cardholders can also enjoy a fee credit of up to $100 for TSA PreCheck or Global Entry. Miles can be redeemed on travel and transferred to travel partners. You may also enjoy the new Capital One airport lounges.
The annual fee is $95. Compare the Chase Sapphire Preferred vs Capital One Venture Credit Card if you are debating between the two.
Learn more: Travel Rewards Credit Cards
The Best Credit Cards for Paying Taxes: Business Cards
If you have a business and will be paying your taxes, one of the options below might work out better for you. You can keep your business expenses separate and earn some rewards in the process. Here are a few business credit card options that might be worth your while.
Ink Business Preferred Credit Card
Bonus Offer: Earn 100k bonus points after you spend $15,000 on purchases in the first 3 months from account opening. That’s $1,000 cash back or $1,250 toward travel when redeemed through Chase Ultimate Rewards®
The Ink Business Preferred® Credit Card not only has that enticing signup bonus, but it also comes with several perks for your business. This includes Fraud Protection on your card transactions and Zero Liability which means you won’t be held responsible for unauthorized charges made with your card or account information.
Cardholders can enjoy Purchase Protection, which covers new purchases for 120 days against damage or theft, up to $10,000 per claim and $50,000 per account.
Ink Business Preferred Credit Card cardholders earn 3x points per $1 on the first $150,000 spent on travel and select business categories each account anniversary year. Earn unlimited 1x point per $1 on all other purchases. Points are worth 25% more when you redeem for travel through Chase Ultimate Rewards®.
The annual fee is $95 and there are no foreign transaction fees, making this one of the best Chase business credit cards.
The Business Platinum Card from American Express
Welcome Offer: Earn 100,000 Membership Rewards® points after you spend $15,000 on eligible purchases with the Business Platinum Card within the first 3 months of Card Membership.
If you prefer more air travel business rewards, The Business Platinum Card® from American Express is worth taking note of. Cardholders earn 5x points on flights and prepaid hotels on amextravel.com. Additionally, they can get 50% more Membership Rewards® points (an extra half point per dollar), on each eligible purchase of $5,000 or more, up to 1 million additional points per year.
Flyers can enjoy a 35% airline bonus when paying with their points for all or part of a flight with their selected qualifying airline. They can get 35% of the points back, up to 500,000 bonus points per calendar year when booking on amextravel.com.
Plus, cardholders can now breeze through security with CLEAR® (where available) and get up to $179 back per year on your membership when you use your Card. Terms apply.
Business Platinum Card from American Express cardholders can also enroll to get up to $200 in statement credits annually by getting up to $100 semi-annually for U.S. purchases with Dell (terms apply). They also have access to the Pay Over Time Option. This is a flexible payment option to help manage cash flow on purchases of $100 or more.
Note that both the American Express Business Platinum vs Chase Ink Business Preferred has similar signup/welcome bonus offers.
Most of us view paying taxes as going to the dentist—it’s something we do as quickly and painlessly as possible. While paying taxes is never fun, using a rewards credit card can actually help you make money by paying your taxes. That won’t happen if you pay your taxes with cash instead.
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For rates and fees of The Platinum Card® from American Express, please click here.
For rates and fees of the Hilton Honors American Express Surpass Card, please click here.
And for rates and fees of The Business Platinum Card® From American Express, please click here.
Chase Sapphire Preferred® Card
- Our best offer ever! Earn 100,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,250 when you redeem through Chase Ultimate Rewards®.
- Enjoy new benefits such as a $50 annual Ultimate Rewards Hotel Credit, 5X points on travel purchased through Chase Ultimate Rewards®, 3X points on dining and 2X points on all other travel purchases, plus more.
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 100,000 points are worth $1,250 toward travel.
- With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
- Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
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