tn69c1935 t1_j6bcyxk wrote on January 29, 2023 at 2:53 AM

Reply to comment by tim36272 in LPT Request: Why is my tax return so low? by ChickenCheeks7

Why 0$ ? If we owe money and pay it a credit card with points or cash back do we not come ahead ?

Downvote_me_dumbass t1_j6boaai wrote on January 29, 2023 at 4:27 AM

No, because you have to pay a service fee when paying on a credit card. I had to pay last year and decided on the credit card route you pay approximately 2%, so unless your rewards card gets you better than that, you aren’t finding some kind of benefit by paying with a CC.

https://www.irs.gov/payments/pay-your-taxes-by-debit-or-credit-card

tim36272 t1_j6bnuv3 wrote on January 29, 2023 at 4:23 AM

Yes that's better, but you can only really do that if you're making substantially more money every year. There is a penalty for underpaying, so you're risking a penalty if you underpay by too much.

love_that_fishing t1_j6dfz4o wrote on January 29, 2023 at 3:53 PM

I purposely owe 3-4k a year. It’s never been a problem. I’m not sure where the cutoff is but that amount has been fine.

wilderop t1_j6hwe8a wrote on January 30, 2023 at 1:24 PM

The tax software doesn't highlight the penalty. Do you read through your entire return before submitting? You may be paying a penalty each year without knowing.

love_that_fishing t1_j6j24an wrote on January 30, 2023 at 6:10 PM

Yes i print out the entire return and review It. Have not been paying a penalty. They also may look at percentages. I pay 50k in federal taxes on average so being short 3k is not a large percentage.