Survey Finds Fees Stop Americans from Paying Taxes by Credit Card
In February we reported that paying taxes with a credit card is a poor idea, due to the 2.49% credit card processing fee that you’d be forced to pay. A new survey from research firm Ipsos Insight shows that these fees are indeed keeping Americans from using what would otherwise be a very convenient form of payment.
The survey of 1,001 people found that while 68% of American adults know the IRS accepts credit cards, only 1% plan to use a credit card to pay their 2005 federal taxes. More than three out of four (78%) said they “definitely will not” use a credit card the next time they owe federal income taxes. However, if the service were free, 23% of those open to the concept would use it.
According to Doug Cottings, Senior Vice President with Ipsos Insight’s Financial Services practice, the processing fees associated with paying taxes with a credit card have defeated the purpose of making this option available in the first place. “The fees negate the attraction to credit card benefits such as convenience, habit, rewards points or payment deferrals. This negative outcome has effectively destroyed the effort to broaden taxpayer’s payment options through credit card payments.”
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