Credit Cards for Income Taxes
Uncle Sam’s tax day is right around the corner! There are several ways that we, as Americans, can arrange to pay him. One of the costliest is to not file on time and not pay what we owe. The next costliest – is to file late and to use a credit card to pay the taxes due. This is especially true when we do not have the available funds to pay the card off at the end of the month. The IRS accepts these payments only thru 3rd party providers and a service fee of anywhere from 2.25 to 2.5% of the transaction is charged. Even a rewards card benefit is cancelled out by this charge. Add the interest that will then be charged monthly by the credit card company and the debt can balloon very quickly. Another option would to be to investigate setting up a short term agreement with the IRS via Installment Agreement Request. Form 9465 (easily downloaded in .pdf format) is available if you don’t owe more than $25,000. Keep in mind you must be able to pay off your debt within 5 years. There are fees charged by the IRS to set up the program. Low credit card interest runs an average of 11%, which is definitely more costly than the IRS’s rate which is calculated on the short-term federal rate plus 3%. A silver lining on the cloud – the IRS will pay you interest if you overpay. To minimize penalties and interest – file on time and pay as much of the tax due as is possible. Of course, the least costly is to file on time and to pay any tax due before the deadline.
Duplicating Identity Theft Services
How much are you paying to avoid having your identity stolen? Each credit card company has a plan available, for a fee. Every bank and credit union is offering protection from identity theft, for a fee. And there are independent Identity Theft Services also available, of course, for a fee. Paranoia is paramount. Most Americans are at a fairly low risk of having their identity stolen. In a FTC study it was reported that 48% of the identity theft was actually credit card fraud which can be easily rectified if you pay attention to your bills and report fraudulent charges within 60 days. Of course, it is still not fun to wait around for new cards – but you’d have to do that if you were paying 3 agencies to find that your credit card was used fraudulently anyhow. So check out what services you have and duplicate overages.
Unemployed to get Assistance with COBRA
Under President Obama’s Stimulus Package there is some help available for paying the COBRA health insurance extension. The primary relief will be for the newly unemployed whose company is required to extend health benefits under COBRA. Not all companies are required to do so. The Plan will help a portion of the eligible workers by paying 65% of the premium for lower income ex-workers. In theory, this should cover the amount that was covered by their employer.
Coastal Credit Solutions, Inc. operates a financial market place that matches Consumers and Businesses with debt eliminating and/or alternative financing service providers. If you have over $5,000 personal or business credit card debt or are seeking small business financing, please call us 866-205-8370 for a FREE no obligation consultation.
If you have any questions or comments regarding this article
please contact Coastal News Contributor at news@coastalcreditsolutions.com |
Getting Started 
