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28 Jan 2010
Capital One sent me some "payment checks" which give a grace period just like a credit card charge, so I deposited a couple in my savings account to collect the interest.
Earlier this month I paid my bill electronically the day before the due date, and once I saw it had posted on their site, I wrote myself another check and deposited it in the bank. Payment and deposit posted at the bank on the same day, so I'm earning my 1.35% APY uninterrupted. When this month's bill arrived, there were three more payment checks in the envelope with it, and in the same day's mail was a little booklet with three more, just in case. I guess they really want to lend me money at 0% interest.
In the meantime, I've been pondering how to best pay my taxes. Since I'm self-employed my income varies a lot from year to year, and this year I'll have a large payment due in April. I could write them a check, but what fun would that be?
You can pay your taxes with plastic through three providers who have arrangements with the IRS. Since the IRS won't pay a merchant fee, they all charge extra. If you use a credit card, they charge 1.95% or 2.35%, much more than any plausible card rebate. But if you pay with a debit card, there's a flat fee of about $4. One bank I use now offers reward points on debit card payments. It's not a lot, one point per $2 with a point being worth about a penny, but a payment of $800 would earn more than $4 of points, and my tax bill will be considerably more than that. Hmmn.
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