Can You Pay California State Taxes with A Credit Card?

How to Pay California State Taxes With A Credit Card

Paying your California state taxes with a credit card offers convenience and potential rewards. This guide outlines the general process to help you complete your payment through official channels.

1. Confirm Fees and Eligibility: Before proceeding, visit the California Franchise Tax Board (FTB) website to confirm that your specific tax liability can be paid by card and to review the current convenience fees charged by third-party processors.
2. Choose the Right Card: Since you will incur a processing fee, it's wise to use a credit card that offers rewards, such as cash back or points, that can help offset this cost. To find a card that suits your needs, you can use resources like the Kudos Explore Cards tool.
3. Select an Official Payment Processor: The FTB does not directly accept credit card payments. You must use one of their authorized third-party payment service providers. Navigate to the payment section of the FTB website to find the list of official processors.
4. Make Your Payment: Choose a processor from the FTB's list and follow their instructions. You will need to provide your tax information, payment amount, and credit card details on their secure platform.
5. Keep Your Confirmation: After completing the transaction, you will receive a confirmation number. Be sure to save this number and a digital or printed copy of your receipt for your financial records.

Impact On Your Credit Score

Paying your California state taxes with a credit card offers convenience, but it's wise to consider the potential effects on your credit score. Here are a few key factors to keep in mind before you decide to charge your tax bill.

• Credit Utilization Ratio. This payment increases the amount of credit you're using compared to your total available credit. A higher utilization ratio can temporarily lower your credit score until the balance is paid down.
• Hard Inquiry. If you open a new credit card for this payment, the application will likely trigger a hard inquiry on your report. This can cause a slight, temporary dip in your credit score.
• Payment History. A large tax payment could make it difficult to pay your credit card bill in full and on time. Any late or missed payments will have a significant negative impact on your credit history.

Alternative Ways To Pay California State Taxes

Pay Directly From Your Bank Account

One of the most common alternatives is paying directly from your bank account. The Franchise Tax Board's Web Pay system allows you to authorize a bank account debit for free. You can schedule payments up to a year in advance, providing flexibility without the convenience fees charged by credit card processors. This method ensures your payment is securely transferred directly to the state.

Pay by Mail or In Person

For those who prefer traditional methods, you can mail a check or money order with a payment voucher to the FTB. While this requires postage and careful mailing to ensure it arrives on time, it avoids online transactions. Additionally, you can pay in person with cash at designated official payment locations, which offers immediate confirmation of your payment without any digital requirements.

Choose the Right Card to Pay California State Taxes

Paying a large sum like your state taxes with a credit card is a major financial move, so picking the right plastic is crucial. While there's no single 'best' card for taxes, the ideal choice depends on your personal financial goals—whether that's maximizing cash back, earning travel rewards, or taking advantage of a 0% APR offer. Instead of guessing, use the Kudos Explore Tool to compare nearly 3,000 cards and find the perfect match for your needs.

For those who want to maximize their credit card benefits, Kudos is the ultimate free shopping tool for online purchases. We are also currently providing $20 back on your first qualifying purchase when you sign-up for free with the code 'GET20' and shop at a Boost merchant.

Frequently Asked Questions

Are there fees for paying taxes with a credit card?

Yes, third-party payment processors charge a convenience fee, typically a percentage of your total tax payment amount.

Which credit cards are accepted for California tax payments?

Official payment processors accept all major credit cards, including American Express, Discover, Mastercard, and Visa for payments.

Can I earn credit card rewards on my tax payment?

Yes, but you should confirm that the value of your rewards will be greater than the processing fee.