Credit cards for taxes or why credit card applications rise in numbers...
There has been a significant rise in credit card applications among businesses, let alone individuals recently. The reason? Well any credit consumer looking to make the most profit out of his credit card would presume it is credit cards’ rewards like points or cash rebates that boosted credit card applications.
But there is yet another cause and it’s the highly appreciated convenience of making financial transactions with a credit card. But today, a credit card allows you not only to pay for products or services but also carry out tax payments and more and more customers find the option significant, especially at tax time.
Naturally pursuing their own goals, banks and credit card companies, Chase and American Express, for instance, also tend to meet the ever growing needs of credit card holders and so, offer more credit card facilities.
To encourage you to pay taxes with credit card, creditors allow you to win double miles or points on each dollar you spend on taxes payments. This is especially beneficial for businesses who tend to travel a lot and thus are more involved in earning points with airline miles credit cards, hotel rewards credit cards or credit cards for gasoline.
So, to get more customers to pay taxes with credit cards, American Express presents Starwood and Delta credit card applications. On their part, Chase and United Airlines offer double miles for every dollar spent on their United Mileage Plus Signature Visa card if you pay your taxes with them.
Well, when the tax season is approaching, feel free to pull out your Visa or MasterCard credit card, pay with it with convenience and be rewarded for that! Businesses were allowed to charge tax payments to their plastics in 2006 and since then credit card use has increased considerably.
And regardless of credit experts’ general opinion that using credit card to pay for something that could be paid with cash or some other way, the number of tax payments charged to credit cards is likely to still grow. The matter is, customers put more trust to paying through a commercial credit card network as, apart from being convenient and fast, it is safe and secure.
But whatever credit card you choose to carry out tax payments, cash back credit card or airline miles card, beware of certain restrictions on them. Some credit cards will probably limit you in the number of points you can collect (Starwood Preferred guest card) or will put you into definite time borders. Other credit cards, like United Visa card are intended for bonus miles with no boundaries but in case you have no late credit card bill payments.
So far, we’ve outlined the incentives of credit cards for tax payments but a customer should mind it that the reinforced reward system is not free, so to say. The enhanced rewards do not abolish interest rates of 30% if you delay credit card bills payments or convenience fee of usually 2.49% of federal or state taxes paid.
Convenience fee or interest rates are, of course, unavoidable and you need to carefully consider all pros and cons of paying for taxes with credit card.
So far, it seems that these terms are not a barrier for customers to use their credit cards at tax season. All the potential rewards (cash back or double points on gas, hotel or airline miles credit cards) have caused a significant rise in credit card use for taxes among Americans since the year of 1999 and businesses joining have notably added to the number. What about you?