- Taxpayers will be informed of the convenience fee amount before the payment is authorized. This fee is in addition to any charges, such as interest, that may be assessed by the credit card issuer. Taxpayers must agree to the terms and conditions of the payment including acceptance of the convenience fee before the transaction is completed.
- The Taxpayer Relief Act of 1997 authorizes the Treasury to accept credit card payments for federal taxes but prohibits the IRS from paying a fee or consideration to credit card companies for processing these transactions.
- In order to give taxpayers the option of paying taxes by credit card, IRS has entered into non-monetary contracts and agreements with credit card payment service providers.
- The service providers act in the capacity of merchants and are necessary intermediaries in credit card transaction processing. The service providers validate credit card numbers and expiration dates, obtain authorization from the credit card issuers and issue confirmation numbers to taxpayers at the end of the payment transaction. The service providers forward tax payment information to the IRS for posting to taxpayer accounts.
- The IRS does not receive or charge any fees for payments. Additionally, the IRS cannot pay or reimburse any convenience fee to taxpayers. The fee is a non-deductible personal expense.