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Paying taxes

Regular Contributor

Paying taxes

Good Morning crew.  

 

Wanted to throw my situation out there and see what ya'lls thoughts/opinions were.

 

Looks like I owe about $4k this year to ole uncle sam.  Gonna get $700 back from the state, though.   I've got a few options. 

 

1. Pay with my NFCU CashRewards.  The fee is 1.87%.  and would get 1.5% back from the card.  Interest rate on the card is 15.65

2. Pay with a NFCU CLOC check.  Interest Rate is 16.9 (have 15k avail right now).  

3. Apply for a PLOC  for the amount (hope for approval and lower rate)

 

Overall utility of CC's is currently 10%  I will apply the state money directly to the balance as soon as I get it.  I make about $80k/yr.   I will be pretty aggressive at paying it off regardless, I just don't have that much cash lying around, unfortunatly.  I'm leaning towards option 2, because of utilization mostly, to avoid a new HP of a new loan. Not planning on seeking any credit for a while maybe a car toward the end of the year, house next summer.    

 

If y'all need more info, just ask.   Most current scores are below. 

Ok credit, getting better.....slowly.... Can't seem to stay in the Garden for any extended period of time. I'm trying. Mid to upper 600's across the board.
15 REPLIES
Valued Contributor

Re: Paying taxes

Not sure what the limit is on your NFCU CC?

That is the least expensive option. 16.02% for CC versus 16.9 for CLOC.

 

My guess is that their PLOC will be more than the rate on your CLOC (personal experience).. 

 

Pay down the CC as quickly as possible and shoot for 9% or less utilization overall and with all cards individually.

 

Good luck

Regular Contributor

Re: Paying taxes

The limit on the CC is $9300.  

Ok credit, getting better.....slowly.... Can't seem to stay in the Garden for any extended period of time. I'm trying. Mid to upper 600's across the board.
Valued Contributor

Re: Paying taxes

If you are worried about scores and utilzation %, go with the CLOC.

You should be able to remain below 30% on utilization.

If however, you put in on the CC, that will bump your CC utilization into an area that will likely pull down the scores.

Established Contributor

Re: Paying taxes


JimBo99 wrote:

Good Morning crew.  

 

Wanted to throw my situation out there and see what ya'lls thoughts/opinions were.

 

Looks like I owe about $4k this year to ole uncle sam.  Gonna get $700 back from the state, though.   I've got a few options. 

 

1. Pay with my NFCU CashRewards.  The fee is 1.87%.  and would get 1.5% back from the card.  Interest rate on the card is 15.65

2. Pay with a NFCU CLOC check.  Interest Rate is 16.9 (have 15k avail right now).  

3. Apply for a PLOC  for the amount (hope for approval and lower rate)

 

Overall utility of CC's is currently 10%  I will apply the state money directly to the balance as soon as I get it.  I make about $80k/yr.   I will be pretty aggressive at paying it off regardless, I just don't have that much cash lying around, unfortunatly.  I'm leaning towards option 2, because of utilization mostly, to avoid a new HP of a new loan. Not planning on seeking any credit for a while maybe a car toward the end of the year, house next summer.    

 

If y'all need more info, just ask.   Most current scores are below. 


FYI: A payment plan with the IRS amounts to 6% APR plus a small transaction fee.

 

I went that route because 1) interest on my credit cards is significantly higher 2) it won't affect utilization

Ch 7 Discharge May 2015: EQ 588/TU 552/EX 570
Nov 2017: EQ 683/TU 660/EX 668 w/ 24% CC util reporting
Discover/Target/NFCU CLOC/NFCU Cash Rewards/PenFed Power Cash Rewards - $46k total revolving
Frequent Contributor

Re: Paying taxes

I would personally opt for Steelers plan.

FICO08 7/27/17 EQ-769, TU-767, EX-761
Gardening unit sometime in 2018
Valued Contributor

Re: Paying taxes


SteelerNYC wrote:

JimBo99 wrote:

Good Morning crew.  

 

Wanted to throw my situation out there and see what ya'lls thoughts/opinions were.

 

Looks like I owe about $4k this year to ole uncle sam.  Gonna get $700 back from the state, though.   I've got a few options. 

 

1. Pay with my NFCU CashRewards.  The fee is 1.87%.  and would get 1.5% back from the card.  Interest rate on the card is 15.65

2. Pay with a NFCU CLOC check.  Interest Rate is 16.9 (have 15k avail right now).  

3. Apply for a PLOC  for the amount (hope for approval and lower rate)

 

Overall utility of CC's is currently 10%  I will apply the state money directly to the balance as soon as I get it.  I make about $80k/yr.   I will be pretty aggressive at paying it off regardless, I just don't have that much cash lying around, unfortunatly.  I'm leaning towards option 2, because of utilization mostly, to avoid a new HP of a new loan. Not planning on seeking any credit for a while maybe a car toward the end of the year, house next summer.    

 

If y'all need more info, just ask.   Most current scores are below. 


FYI: A payment plan with the IRS amounts to 6% APR plus a small transaction fee.

 

I went that route because 1) interest on my credit cards is significantly higher 2) it won't affect utilization


This is your best option. Just pay it downn as quickly as you can. The Fed is pretty easy to work with for the most part.

Ray

** Every Card has a Job, and Every Card does its Job **
Established Contributor

Re: Paying taxes

A word of caution. IRS at $10,000 always puts a tax lien on you. Under $10,000 and its up to them however I have seen $500 tax liens before. 

Valued Contributor

Re: Paying taxes

Actuaslly the IRS 6% plan is the best suggested. A decade ago I owed $16,000 in taxes and thought I was going to be in big trouble. The IRS was nice as can be and set up a plan to pay it off over 2-3 years. Did not show up on my credit reports so no negative effect on utilization.

 

 

Established Contributor

Re: Paying taxes

Payment plans never show on credit reports just the lien they file when you get one or lien if don't pay