Yes, you can pay federal income tax with a credit card, but it costs money and comes with real tradeoffs
The IRS accepts credit card payments for federal income tax through two payment processors: ACI Payments and PayUSA. You can pay on their websites or by phone. The catch is that the processor charges a convenience fee — typically between 1.87% and 2.35% of your payment — that you pay on top of your tax bill. If you owe $5,000 and pay with a credit card, you might pay an extra $94 to $118 just for the privilege of using plastic.
The real question is not whether you can do it, but whether the credit card rewards you earn will offset that fee. If your card gives you 2% cash back and you pay a 2% fee, you break even. If your card gives you 1% back and you pay a 2.35% fee, you lose money. Most people should pay by bank transfer or check instead — it costs nothing and takes the same amount of time.
Key Takeaways
- The IRS accepts credit card payments through ACI Payments and PayUSA, both of which charge a convenience fee between 1.87% and 2.35% of your payment amount.
- You only come out ahead if your credit card's cash back or rewards rate exceeds the convenience fee charged by the processor.
- Paying by direct bank transfer (ACH) or check costs nothing and is the default option most taxpayers should use.
- If you do use a credit card, make sure you can pay off the balance when ready — carrying a balance at credit card interest rates will cost far more than the convenience fee.
How the two payment processors work
ACI Payments and PayUSA are the only two companies the IRS has authorized to take credit card payments for taxes. You can find links to both on IRS.gov under "Pay by Credit or Debit Card." Each processor charges its own fee, and the rates change periodically, so you should check the exact amount before you submit payment.
Both processors accept Visa, Mastercard, American Express, and Discover. You enter your tax information, card details, and the amount you want to pay. The processor charges the fee to your card at the same time as the tax payment itself. There is no separate invoice — you see one charge that includes both the tax and the fee.
Payment is when ready. The IRS receives the money the same day or the next business day, which matters if you are close to a important date. If you are filing an extension and paying by April 15, paying by credit card through one of these processors is faster and more reliable than mailing a check.
When credit card rewards actually make sense
A credit card payment only saves you money if your rewards rate is higher than the convenience fee. Here is the math: if you owe $10,000 and the fee is 2%, you pay $200 in fees. If your card gives you 2% cash back, you earn $200 in rewards. You break even. If your card gives you 3% cash back on government payments (some cards do), you earn $300 and come out $100 ahead.
The cards most likely to make this work are premium travel or business cards that offer 2% or higher cash back on all purchases, or cards that specifically reward government or utility payments. Check your card's rewards structure before you pay. If you are not sure whether your card qualifies, call the card issuer and ask: "What cash back rate do I earn on federal tax payments?"
Even if the math works, only use this method if you can pay off the credit card balance when ready. If you carry a balance, credit card interest rates (usually 18% to 25% annually) will cost you far more than any rewards you earn. A $10,000 payment that sits on your card for three months will cost you $450 to $625 in interest — a much bigger hit than the $200 convenience fee.
The free alternative: paying by bank transfer
The IRS also accepts direct bank transfers (ACH payments) through its Electronic Federal Tax Payment System, or EFTPS. This method costs nothing. You link your bank account, schedule the payment, and the IRS pulls the money on the date you choose. It takes one to three business days to clear, so you need to plan ahead if you are near a important date.
EFTPS is free to set up and free to use. You can pay any amount, any number of times. The only downside is that you need to plan a few days in advance — you cannot pay on the same day you file. If you are filing on April 14 and the important date is April 15, EFTPS will not work; you would need to use a credit card, check, or money order.
For most people, EFTPS is the right choice. It costs nothing, it is reliable, and it takes the same amount of time to set up as a credit card payment. The only reason to use a credit card is if you have a high-rewards card and the math clearly works in your favor.
Debit cards and the same-day payment option
You can also pay federal taxes with a debit card through the same two processors (ACI Payments and PayUSA). The convenience fee applies to debit cards just as it does to credit cards. The only advantage of a debit card is that you cannot accidentally carry a balance — the money comes straight from your bank account. But you also earn no rewards, so there is no financial reason to choose a debit card over a bank transfer.
Both processors offer a same-day payment option for an additional fee on top of the convenience fee. If you are filing on April 14 and need the payment to reach the IRS by April 15, same-day payment guarantees it will arrive. The extra charge is usually $15 to $20. This is the only scenario where paying by credit or debit card makes sense if you do not have high-rewards cash back: you are paying for speed, not for the payment method itself.
What happens if you cannot pay in full
If you owe taxes but cannot pay the full amount right now, a credit card is not the answer — it will only add interest charges on top of your tax debt. Instead, you can set up a payment plan with the IRS. Short-term plans (120 days or less) are free. Long-term plans (more than 120 days) charge a setup fee, usually $31 to $225 depending on how you set it up, but there is no interest on top of your tax bill itself.
The IRS also offers an Offer in Compromise, which lets you settle your tax debt for less than you owe if you truly cannot pay. This is a formal process that requires documentation of your income and expenses, and approval is not may provide. But it is worth exploring if you owe a large amount and have no way to pay it.
Frequently Asked Questions
Will paying taxes with a credit card hurt my credit score?
Paying your tax bill with a credit card will increase your credit utilization (the percentage of your credit limit you are using), which can temporarily lower your score. If you pay off the balance when ready, the impact is small and temporary. If you carry the balance, your score will drop more significantly and stay down until you pay it off.
Can I use a rewards credit card to pay estimated quarterly taxes?
Yes. Self-employed people and business owners who pay estimated taxes can use the same two processors (ACI Payments and PayUSA) to pay quarterly estimated payments with a credit card. The same convenience fee applies, and the same math about rewards rates holds true.
What if I pay by credit card and then file an amended return?
If you overpaid your taxes and file an amended return, the IRS will refund the overpayment to your bank account, not back to your credit card. You will need to wait for the refund to arrive in your bank account, then pay off the credit card balance yourself. This is another reason to avoid credit card payments unless the rewards clearly justify it.
Is there a maximum amount I can pay with a credit card?
Both ACI Payments and PayUSA accept payments of any size. There is no cap on how much you can pay in a single transaction. The convenience fee applies to the full amount, regardless of size.
Can I pay state taxes with a credit card too?
State tax payment options vary by state. Some states accept credit cards through their own payment processors, while others do not. Check your state's tax agency website to see what payment methods are available. If your state does accept credit cards, the same logic applies: only use it if your rewards rate exceeds the convenience fee.