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For example, if you transfer $6,000 in credit card debt to a card offering 0% intro APR for 18 months, you could pay off the full amount by making $333 monthly payments with no added interest charges.
With the Tax Reform Act of 1986, the government stopped allowing a tax deduction for consumers on credit card interest payments, arguing that the deduction encouraged growing consumer debt.
If your credit score is intact, a credit card with a 0% APR can also be a resource. Many cards have introductory periods of 12 to 15 months, allowing you to take on debt without immediate penalty.
“While it’s possible to pay IRS tax debt with a credit card, think twice about that,” Micheletti said, noting that current credit card interest rates average more than 20%.
The IRS’s long-term payment plan setup fee is assessed as follows: Non-direct debit payments: the setup fee is $130 if you apply online. For mail, in-person or phone applications, this fee comes ...
“By doing this, you’ll pay off your smallest debt first, then move your way up, directing extra money toward each balance as you go.” Check Out: 7 Tax Loopholes the Rich Use To Pay Less and ...
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