Existing Chase ‘Pay Yourself Back’ Categories Appear Slated to End on April 30

A while back, Chase extended the Pay Yourself Back categories through April 30th. It wasn’t known whether it would continue getting extended or not, but early indications are that – indeed – after April 30th the existing categories will no longer be valid:

Reader Peter shares a screenshot from within his Chase login (taken on February 26th) which shows all eligible PYB transactions from February to have a 62 day expiration, meaning that the transactions can be redeemed PYB through April 30th. That’s less than the typical 90-day allotment, presumably because after April 30th these categories will not be eligible.

Last time around, people were wondering why Chase showed the full 90 days, despite the entire PYB benefit expiring in less than 90 days; then, Chase extended the benefit and it all made sense. This time, they took the pains of changing the number of days left which would seem to indicate that the existing PYB categories will not be extended beyond April 30th.

Most likely there will be new eligible categories beginning May, but we don’t know what they’ll be – it’s worth cashing out now if you find the Grocery and Dining categories easily usable. Grocery also works out now with the 3x Sapphire Reserve grocery multiplier.

Source: doctorofcredit.com

What is a Credit Limit, How is It Determined, and What Credit Cards Offer the Highest Limits?

[UPDATE: Some offers mentioned below have expired and/or are no longer available on our site. You can view the current offers from our partners in our credit card marketplace. DISCLOSURE: Cards from our partners are mentioned below.]

What is a credit limit and how is it determined? A credit limit is the maximum amount of credit you’re allowed, and it is determined by a financial institution (bank, credit union, retailer, etc.).

Essentially, when you apply for a credit card and you get approved, the issuer decides how high (or low) your limit will be. The average credit card limit is $16,737, but this varies depending on your credit score and where you live.

We know how it goes: first you cross your fingers hoping you’ll get approved for the credit card you want. Then you cross them again hoping the credit limit will be generous enough to get you what you want. Maybe you need it to pay for some expensive dental work or perhaps you are applying for a 0% balance-transfer offer so you can transfer debt from another, higher-interest card. Either way, the credit limit is often a few hundred or a few thousand dollars short of what you need — and you have no idea why. How did they even come up with that number?

Credit card issuers will tell you what factors they consider when they assign a credit limit, but exactly how they calculate it remains proprietary. Not a single card issuer we reached out to for this story could (or would) give us specific information about how they determine credit limits.

In every case, your credit score and income level will have a great deal to do with whether you are approved, and for how much. If you’ve had credit before and handled it well, a card issuer is more likely to approve your application. But that is not the whole story.

Your income comes into play, and so do your current financial obligations, such as rent, a car loan, and the amount of credit available to you through other cards. Part of the equation is behavioral: What do they think you are likely to do if you have more credit extended? In this guide, our Credit.com experts present the top cards with high credit limits that match your financial health and history, and help you understand all that goes into determining your credit limit.

Credit Cards With High or Unlimited Credit Lines

Did you know there are credit cards with unlimited credit lines? Well, there are—and you’ve probably heard of them. Although credit limits are determined by various factors, as we discussed (such as income and credit score), it is possible to find cards with high limits. Here are some of our favorites, from our trusted partners*:

Chase Sapphire Preferred® Card

  • Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $750 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases.
  • 2X points on dining at restaurants including eligible delivery services, takeout and dining out and travel & 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for travel through Chase Ultimate Rewards®. For example, 60,000 points are worth $750 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash’s subscription service. Activate by 12/31/21.
  • Earn 2x total points on up to $1,000 in grocery store purchases per month from November 1, 2020 to April 30, 2021. Includes eligible pick-up and delivery services.

Blue Cash Preferred® Card from American Express

  • Earn a $300 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months.
  • $0 introductory annual fee for one year, then $95.
  • 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%).
  • 6% Cash Back on select U.S. streaming subscriptions.
  • 3% Cash Back at U.S. gas stations and on transit (including taxis/rideshare, parking, tolls, trains, buses and more).
  • 1% Cash Back on other purchases.
  • Plan It® gives the option to select purchases of $100 or more to split up into monthly payments with a fixed fee.
  • Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit.
  • Terms Apply.

Credit Cards for Building Credit

You’ve checked your credit score, and it’s not as high as you’d like — in fact, it’s quite low. Don’t worry, you can rebuild your credit score. It will take time, so be patient (and diligent about paying your monthly bills on time) and eventually, you could be qualified for an unlimited credit limit. Until then, consider these credit cards, which will help you continue to build your credit:*

OpenSky® Secured Visa® Credit Card

  • No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.
  • The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.
  • Build credit quickly. OpenSky reports to all 3 major credit bureaus.
  • 99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.
  • We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search “OpenSky Card” in Facebook.)
  • OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.
  • *View our Cardholder Agreement located at the bottom of the application page for details of the card

First Progress Platinum Elite Mastercard® Secured Credit Card

  • Receive Your Card More Quickly with New Expedited Processing Option
  • No Credit History or Minimum Credit Score Required for Approval
  • Full-Feature Platinum Mastercard® Secured Credit Card
  • Good for Car Rental, Hotels; Anywhere Credit Cards Are Accepted!
  • Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
  • Credit Line Secured by Your Fully-Refundable Deposit of $200 — $2,000 Submitted with Application
  • Just Pay Off Your Balance and Receive Your Deposit Back at Any Time
  • Apply in just a few moments with no negative impact to your credit score; no credit inquiry will be recorded in your credit bureau file
  • Nationwide Program though not yet available in NY, IA, AR, or WI * See Card Terms.

Why Your Credit Limit Matters So Much

While it feels great to get approved for a new account, pay attention to the credit limit. If you’re given a limit of $2,000 and you regularly spend $1,500 per month, then you’ll be using 75% of your credit, which can really hurt your credit score. Balances higher than 20% to 25% of your available credit can hurt your credit scores.

In the case of a balance transfer, you’ll have to weigh that against the interest you’ll save by getting out from under a high interest rate. And in the case of essential bills, like dental or medical, you may have to accept a temporary hit to your credit in order to pay the bill and avoid having an account turned over to collections.

So getting a high credit limit is ideal. There is no credit limit calculator that determines exactly what limit you’ll get, unfortunately, but we’ll help you figure out what factors may go into the decision.

What Should Your Credit Limit Be?

Having a high credit limit comes with many perks, and if a company offers you a high credit limit when you apply, it means they consider you a reliable customer. This is a good thing. But if you look at the flip side, what if you’re an overspender? It can be tempting to want to spend as much credit as you’re given, but doing so can really hurt your credit score.

Keeping your limit low could prevent you from spending more than you have (but to avoid this, you should consider using financial apps to better manage your spending habits and/or debt). Ideally, a high limit is both preferable and recommended, if you want to improve your credit. To improve your credit, you can apply for credit cards with high limits. If you maintain a high limit and a very low or no monthly balance, the better for your credit score.

Should I Ask For a Higher Credit Limit?

If you believe the credit limit you were assigned is too low, you can call the credit card issuer and ask for a higher one. It helps if you can justify your request with some information the issuer did not have when you applied (“I just mailed in my last car payment” or “My spouse has returned to work, and now our household income is higher than the number on the application”). It’s smart to consider that your credit limit can also be lowered if you give your lender reason to believe you may not be able to handle your current limit.

Sometimes, however, you can get them to change their mind simply by sweetening the pot and letting them know you’ll bring over a balance from another card or charge a significant purchase to the new card. Issuers want cardholders who pay interest on balances. After all, that’s how they make money.

When Should You Ask For a Credit Increase?

If you already have a credit card and feel you deserve a credit limit increase, you should ask yourself the following questions:

  • Am I paying off my balance each month?
  • Has my income changed significantly to justify the credit increase?
  • What should my credit limit be?
  • Do I have good credit?

You should wait for at least one year after opening your credit card to ask for an increase. When you do ask, be prepared. The credit card company may make a hard inquiry on your credit reports — and this, of course, can impact your score (minimally, though).

If you feel you have built up good credit, are financially responsible and capable of taking on a higher credit limit, then you should consider asking.

What If My Limit is Raised Without Asking?

Sometimes your credit card issuer may raise your limit without your requesting it, too. That can happen after a period of paying on time and keeping balances low. Some people worry that perhaps there is a downside to this, and wonder if they should ask that the lower limit be reinstated. Generally the answer is no.

Assuming your credit card usage stays the same, you’ll be using a smaller percentage of your available credit, and that can only help your score. Remember, it’s a good idea to keep your credit utilization to less than 20–25% of your credit limit; less than 10% is ideal. Credit utilization refers to the ratio of your credit card balance(s) to your credit limit. The lower, the better for improving your credit, earning rewards, and saving money.

So, sadly, it’s generally not possible to know exactly what your credit limit will be ahead of time. In the meantime, you can control some factors that may affect the issuer’s decision. It’s important to maintain (or work toward) good credit.

You can check your progress with a free credit report summary, updated every 14 days, on Credit.com, or you may find free scores on your monthly credit card statement. You should be sure you are comparing the same score from month to month, because many scoring models are used, and you want to be sure you look at the same one so that changes are meaningful.

The other thing you can do is to check your free annual credit reports to make sure the information there is accurate (and to dispute any that is not). Because your scores are calculated from information in your credit reports, you want to make sure it’s correct and that your information has not been mixed in with anyone else’s.

What Factors Go Into Selecting Your Credit Limit?

When credit card issuers determine your application status and your credit limit, they use a variety of factors, all of which may weigh differently to the issuer. Here’s what could impact their decision:

  • Your monthly income—If your income changes drastically from year to year, this could change the issuers decision. Again, if you salary changes (or if your marital status changes and impacts your income), the issuer should be notified.
  • Your credit history and worthiness—Have you had low or high credits before? Have you kept zero or low balances on previous credit cards? This could impact the application status.
  • You relationship to the issuer—If you’ve been banking with them for years or have another card from them, this could help get you approved and issued a high credit line (but only if you’ve proven to be a reliable customer).
  • Your employment status—This may or may not make a difference, but the issuer would like to know if you are part-time, full-time, self-employed, or unemployed, as this could affect your ability to pay off your future balances.
  • Your residential status—If you own a home and pay a monthly mortgage, you will likely be able to pay monthly credit card bills, too.
  • What type of card you’re applying for—Are you applying for the card with the highest rewards, but you have low credit? Make sure you’re being realistic when you apply for a credit card, but don’t sell yourself short either.

Managing Your Credit and Personal Finances

We’re all aiming for financial stability, and whether that means owning a home, paying off your mortgage, paying for your kids’ colleges, or retiring early, the ultimate goal is to lower your debt-to-income ratio and become debt-free. To determine your credit, limit calculators are available online.

Use Credit.com’s debt-to-income calculator to evaluate how much combined debt you currently have (ex. student loan debt plus car loan payments plus credit card payments, etc.) and how long it will take to pay off based on your current income and your monthly rent.

If you’re struggling to pay off the balances on the credit cards you currently have, check out Credit.com’s credit card payoff calculator to determine how much you still owe and when you’ll likely be debt-free. Just remember, credit repair takes time (and credit repair services are available to those who need them), but when your credit score improves, likely so will your credit limit.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

*Note: At publishing time, the Capital One, Chase, Credit One Bank, and Discover credit cards are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for this card. However, this relationship does not result in any preferential editorial treatment. This content is not provided by the card issuer(s). Any opinions expressed are those of Credit.com alone, and have not been reviewed, approved or otherwise endorsed by the issuer(s).

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Source: credit.com

American Express Adds Cell Phone Protection on their Premium Cards (Platinum, Delta)

American Express added a new cell phone protection benefit on their premium cards which begins on April 1, 2021. If you’ve been using your card to pay your cell phone bill and your phone gets stolen or damaged (including screen damage), AmEx will reimburse the repair or replacement costs of up to $800 per claim. Limit two claims per 12-month period. $50 deductible on each claim.

Direct Link | Benefit Terms (pdf) 

The following cards are eligible:

  • AmEx Platinum cards consumer and business versions (including Schwab, Morgan Stanley, etc. versions)
  • Platinum Delta SkyMiles cards consumer and business versions
  • Delta Reserve cards consumer and business versions
  • Centurion cards consumer and business versions

When comparing it to other cell phone credit card benefits, the $800 is higher than the standard $600 limit found on most cards, though lower than the $1,000 Citi Prestige benefit.  See Credit Card Cell Phone Insurance Compared – Get $600 In Coverage For Free (hopefully William will add the AmEx benefit to that post soon).

This benefit works especially well on the Delta cards during 2021 since there are separate wireless credits of $15 or $20 on the Delta Platinum business and Delta Reserve business cards through December. Also works well on the business Platinum card which earns 5x on the wireless category through June 30, 2021.

Source: doctorofcredit.com

Maximize Cash Back for the Holidays with these Credit Cards

[DISCLOSURE: Cards from our partners are mentioned below.]

The holidays are coming. This may mean lots of shopping. You might be considering how you can spend money and earn rewards for shopping. Well, you’re in luck! There are some great credit cards out there that offer cash back rewards – which means that spending for the holidays can help you earn some serious cash back.

When looking for a credit card with great cash back rewards you need to find one that suits your spending habits. With this in mind, one of the best places to find those cards is by using Credit.com.

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Credit.com allows you to easily search for credit cards using a few different categories to filter with:

  • Card Type: you can search for credit cards based on personal credit cards, student cards, business cards, and military cards.
  • Rewards: there are options for cash rewards, airline miles, gas rewards, or hotel points
  • Preferences: you can filter out credit cards based on if they have no annual fee, low APR, or cards that can help you build credit.
  • Credit Level: you can easily filter out cards based on your credit score so that you have a higher chance of getting approved for what you apply for.
  • Issuer: if you have a preference of which bank your credit card will go through, you can filter based on that bank.

You can also compare cards to see what’s best for you. Let’s take a look at some credit cards that offered on credit.com.

Credit Cards with Great Rewards

Chase Freedom Unlimited® 

The Chase Freedom Unlimited card offers 1.5% cash back on every purchase automatically and there is no minimum to redeem for cash back. Plus, you can earn $150 dollars if you spend $500 dollars in purchases within the first 3 months of opening your account. The cash back does not expire as long as your account is open.

Capital One® SavorOne℠ Cash Rewards Credit Card

If you’re a foodie, then the Capital one SavorOne Cash Rewards Credit Card is for you. Cardholders earn unlimited 3% cash back on dining and entertainment, 2% at grocery stores and 1% on all other purchases. Plus, there’s opportunity to earn a one-time $150 cash bonus after spending $500 within the first three months of the account opening.

Wells Fargo Cash Wise Visa® Card

The Wells Fargo Cash Wise Visa Card is very flexible – cardholders earn unlimited 1.5% cash rewards on all purchases. Plus, you can earn 1.8% cash back on qualified mobile wallet purchases like Apple Pay or Google Pay within the first 12 months of the account opening. Not only that, but you can also earn a $200 cash rewards bonus after spending $1,000 in the first three months of the account being open.

What to Look for When Applying for a Card

You want to find a credit card that offers the most generous rewards for your spending. Some cards offer more rewards for certain categories, like groceries or gas. If you spend a lot in one category, then you may want to apply for a card that gives you more rewards for that category.

Also, it may be good to find a card that doesn’t have a limit on the amount of cashback you can earn. Some cards put a cap on how much you can earn back from spending in certain categories. To see if there are any limits, see the card issuer’s terms and conditions.

Another thing to consider is the fees. If you’re interested in a card with an annual fee, see if it will actually be worthwhile. If you travel outside the country a lot, then you’ll likely want a card that has no foreign transaction fees.

Finally, if you can, find a card that offers a sign-up bonus. Not all cards do this, and it’s okay if you go with a card that doesn’t offer one. Some sign-up bonuses can mean hundreds of dollars in cash back (if you meet certain spending thresholds) and it can be a great opportunity to earn a lot of rewards.

What to Avoid When Applying for a Card

There are several things that you may want to avoid when applying for a credit card:

  • Cards that have a high annual fee but offer few and low rewards for spending.
  • Cards that offer substandard rates of return – you’ll end up spending a lot of money without seeing much cashback or spending rewards coming your way. Remember though, that in order to qualify for a card with great rewards, you likely need to have a good or excellent credit score.

Compare and contrast different cards to find the one that best fits your spending habits. You don’t want to be stuck with a card that offers travel rewards when you don’t fly. These rewards won’t be useful to you.

If you have debt, you might want to avoid cash back reward cards and instead find a credit card that offers low interest rates. This is because the debt that you carry may cancel out the cash back rewards that you earn. Plus, the temptation of earning cash back might cause you to overspend.

Should You Apply for More than One Credit Card?

Different cards offer different rewards in different spending categories. In some cases, it may make sense to apply for more than one card.

One issue you may encounter is you run the risk of having more accounts than you can handle. You might not be able to pay off the cards each month.

Finally, applying for multiple credit cards at a time can bring down your credit score. Credit score formulas assume that since you’re applying for multiple cards that you’re a higher credit risk.

With all of this in mind, find a card (or cards) that fits your spending habits and offers rewards that you’ll use. Also, make sure that you aren’t charging more than what you can pay in full at the end of the month to maximize the rewards the card can offer you.

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To see what cards you may qualify for, sign up now for a free Credit.com account. We give you two free credit scores that are updated every 14 days, as well as a Credit Report Card, which is a summary of what’s on your credit report.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

At publishing time, the cards mentioned are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for this card. However, this relationship does not result in any preferential editorial treatment. This content is not provided by the card issuer(s). Any opinions expressed are those of Credit.com alone, and have not been reviewed, approved or otherwise endorsed by the issuer(s).

Source: credit.com

7 Ways to Get Credit When You Don’t Have Any

Credit is one of those things you don’t want to be without. But, as we all know, the credit game is definitely a Catch-22. You need a good credit history to snag the best deals on loans, yet it’s very difficult to get credit without a borrowing history.

1. Become an Authorized User

If a friend or family member has exceptional credit and faithfully pays their bills on time each month, request to be added as an authorized user to that person’s credit card.

Afraid that your prospect will say no out of fear that you will rack up an excessive amount of debt and bail out? Inform them that you are only requesting to be added to the account; the magic plastic does not need to be in your possession.

While this is a simple way to start building your credit as long as the original cardholder maintains stellar credit habits, the weight given to accounts in which you are an authorized user varies by lender and it might not be as effective as you hope.

2. Get a Co-Signer

You can also request that a close friend or family member with good credit co-sign a loan with you.

Keep in mind that’s asking a lot, because the co-signer becomes responsible for making the payments if you don’t pay. It’s generally advised that people avoid co-signing loans for other people because of the risk involved.

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3. Apply for a Secured Credit Card or One that Doesn’t Require Credit History

Lots of lenders offer secured credit cards to those who are new to credit. They mandate a deposit be used as collateral and typically have a credit limit of that amount.

Some lenders refund your deposit and convert the card to an unsecured card after you show your ability to handle debt responsibly for a time.

Before you apply though, ask about the creditor’s reporting practices. If they don’t report to all three major credit bureaus, account activity won’t have any effect on your credit profile. Also, avoid secured cards that have a lot of fees, keep your outstanding balance under 20% of your credit limit, and always pay the bill on time.

4. Diversify Your Debt

Although the types of debt you have accounts for only 10% of your FICO score, it can have a significant impact if there isn’t a lot of other information present in your profile.

In lieu of revolving debt products, such as credit cards, you may want to apply for some sort of installment loan — a car loan, perhaps, or a personal loan — because it can demonstrate your ability to handle credit responsibly over time. Potential creditors will also be interested in your experience with different types of debt.

5. Check With Your Financial Institution

You may have read the last point and thought, “How in the heck am I supposed to go about obtaining an installment loan when I don’t have any credit?”

The first step is to contact your bank or credit union, explain your situation, and see what options you have. Many offer both secured and unsecured personal loans to existing customers in good standing.

6. Apply for a Store Credit Card

This option definitely requires self-discipline.

Store cards aren’t as difficult to qualify for as standard credit cards, but they may be accompanied by higher interest rates and excessive fees. Also, store cards may be exclusive to the retailer and can’t be used elsewhere.

If you take this route and quickly max out the card, you will do more harm than good to your credit profile. So before you sign on the dotted line to apply for a department store credit card, take all those factors into consideration and don’t get sucked in by the enticing introductory offer.

7. Ask Companies to Report on Your Behalf

I’m almost certain you’ve constantly been reminded about the importance of making timely payments because this factor accounts for 35% of your FICO credit score. Assuming you have recurring expenses each month, such as rent, utilities and a cellphone bill, request that the service provider report your account activity to the three major credit bureaus. But do so only if the accounts are current and you have a stellar payment history.

Before you actually move forward and seek credit, you have to ask yourself if it’s something you really need. It doesn’t make sense to purchase an item on credit that will end up costing you an astronomical amount of cash in the long term because of interest and fees. The smart credit card user pays off the entire balance each month.

And by no means am I an advocate of obtaining new credit accounts and making purchases just for the sake of establishing credit — unless you were going to buy those items anyway.

This post originally appeared on Money Talks News.

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This article was previously published, and has since been updated by another author.

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Source: credit.com

American Express Saying Cardholders Responsible For Some ‘Unauthorized’ Charges

We recently reported that there seems to be a widespread data breach as a lot of cardholders are seeing unauthorized/fraudulent charges on their cards. If you haven’t already checked your cards for these transactions it’s strongly recommended that you do. Most card issuers are cancelling the current cards, issuing a new card and then refunding the unauthorized charges.

Unfortunately it seems that American Express is not doing the last bit and claiming that these charges are the responsibility of the cardholder  (1, 2, 3, 4). If you dispute the charge a second time, American Express is refunding the charge (1).  I suspect this will be eventually fixed and refunds will be offered after the first dispute once American Express realizes how widespread this problem is.

Source: doctorofcredit.com

Is Credit Card Interest Tax Deductible for My Business

Individuals and businesses use credit cards every day. Both earn rewards points that make paying for needed items easier. But if you’re a business owner, your business credit card has expenses and fees attached to it. Thankfully, some of those expenses and fees are tax deductible on your business taxes—including the credit card interest. Some business credit cards are better at helping you score deductions on your taxes than personal cards. In fact, nearly every fee you pay on your business credit card can be written off.

Let’s look at how credit card interest is tax deductible along with some other possible deductions. A note: Don’t assume these deductions apply to your personal credit card.

1. Credit Card Interest Charges

In an ideal world, you won’t pay interest on your business purchases. But, there are times when you need equipment, and there just isn’t enough cash in the bank to pay for it right away or to pay the full balance on your card that month. The good news, you can deduct any interest charges you do pay from your taxes. The only requirement is that the purchase that you’re deducting the interest for business-related and made during that tax year.

To determine how much interest you paid over the year for business expenses, simply check the monthly credit card statements from your business card issuer.

2. Annual Fees

The annual fees you pay on your business credit card are tax deductible, which can help justify getting that business credit card with the steeper annual fee that also has amazing rewards. Yes, you can write it off. Remember though that the primary use of the card needs to be for business purposes and not for personal expenses.

>> Looking for a no-annual-interest business card? Check out the Chase Ink Business Cash credit card. Read our full review.

3. Late Fees

Hopefully, you’re not incurring late fees on your business credit cards. Mistakes happen though, and you may sometimes forget to make a payment. If that happens, late fees can be written off of your business taxes. Of course, it’s always best to call the company and explain you forgot and ask if they can waive the fee this time. Saving $39 is likely going to deliver a higher ROI than claiming a tax deduction for a late fee.

4. Swipe Fees

If you accept credit card payments from your customers, you pay a swipe fee to the customer’s card issuer each time. That fee can be from 1.5% to 5% of the transaction total. The good news here, those fees are deductible from your business taxes as well.

5. Miscellaneous Fees

Sometimes other fees are associated with using a business credit card. For instance, if you need cash, any cash advance fees are deductible. However, most financial professionals don’t recommend this expensive way of accessing cash. Do, consider it for emergencies only.

Convenience fees—paid for the “convenience” of using a credit card to pay when the card isn’t a typically accepted form of payment—are also deductible on your business taxes.

Interest Paid on Personal Expenses Is Not Tax-Deductible

The deductibles covered here are for business credit cards and business expenses only. If you use your business credit card for any personal expenses and pay interest on those expenses, that interest is not deductible on your business tax return.

If you use your business card for personal expenses as well as business expenses, review your statements and calculate how much of the interest was for business expenses. Simply recalculate the interest for the total monthly balance minus the cost of the personal items.

It’s always easier to calculate your interest during tax time if you dedicate your business credit card to just business purchases. Keep your personal finances out of the equation. It’s also a better way to prove all your expenses if something comes up and the IRS has questions.

Maximizing Your Tax Deductions as a Business Owner

Using a business credit card is a great way to build a strong credit history for your business. Yes, Virginia, businesses have credit scores and reports too. And maintaining or building a good credit score and history for your business can help you get a business loan if needed someday. It’s also a way to ensure your business has access to lower interest rates on your business loans and credit cards.

And no matter how big or small your business is, if you use a business credit card for business expenses, you can deduct credit card interest charges and fees from your business taxes.

To maximize your business tax deductions, make sure to take advantage of each deduction available to you. If you’re unsure if a particular fee qualifies as a deductible expense, it doesn’t hurt to see a tax professional to make ensure you’re maximizing all the tax deductions available to you as a small business owner.

If you think you’ve been leaving credit card-related tax deductions on the table, it’s a good idea to go through your card statements before filing your taxes and add up all the fees. You could reduce your business tax liability considerably if you’re using your credit card for business use.

This article was originally published January 1, 2017, and has been updated by a different author.

At publishing time, the Chase Ink Business Cash card mentioned in this article is offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for these cards. However, this relationship does not result in any preferential editorial treatment. This content is not provided by the card issuer(s). Any opinions expressed are those of Credit.com alone, and have not been reviewed, approved or otherwise endorsed by the issuer(s).

Source: credit.com

Tips to Managing Your Online Credit Card Spending

Managing your online credit card spendingAmazon, and Home Depot, and Target, oh my! Online spending is certainly on the rise in the midst of the global pandemic of 2020. As if online shopping wasn’t already an obsession for many, couple it with quarantine, and you’ve created an online shopping monster!

In fact, according to FinancesOnline, the United States is the leading country in the world for average e-commerce revenue per shopper!

It’s Real Cash

One of the reasons it is so easy to just click “Buy Now” and type in your credit card information is because it just doesn’t seem real. Without physically counting out the cash and handing it over and receiving just a few cents back in return or swiping the plastic, it does not feel like you are truly spending your money.

Essentially, it is much more difficult to conceptualize spending real paper money when you type in the numbers on the back of your credit card, especially if your computer has already saved your credit card information on there!

According to NPR, 78% of shoppers typically shop online to avoid waiting in line.

Below are a few tips to help to make this problem a little better for you and to help minimize your online credit card spending and purchases.

Stop Saving Your Credit Card Info

It will amaze you how much more time you have to think about the purchase you are about to make and if you really need that item in the time that you have to spend getting up from your computer or phone, searching for your wallet, typing in the credit card information, and putting the card back in your wallet and back where it belongs. This means no more impulse buying from bed, the bathroom, or the car. It helps to make yourself aware of the cost.

Avoid Online Pressuring Tactics

It’s out there: online sellers and marketplaces utilize many tools, subliminal messaging, and tactics to make you purchase online. If you pay attention, many “flash sales” actually run a lot longer, if not indefinitely, than they are advertised for. In other cases, some websites have a time limit on how long an item can be in your shopping bag. This makes you feel a false urgency to buy it right away. More often than not, if something sells out, it will be restocked.

The best tip to avoid being pressured into purchasing something is to keep in mind that if you are not actively searching for something specific, do not purchase it! If you stumble across something cool but do not necessarily need it, it is not worth racking up more charges on your credit card.

Get Organized: Budget

It sounds cheesy, but setting a budget in your spending specifically for online shopping sets boundaries in your head. You can even open up a separate account with a specific amount of money in there (a secured card) or you can conduct placing a spending limit on your credit card. It is important to sit down and take a look at your income and how much you have available for online shopping.

Minimizing your spending on credit cards, in general, is a very wise way to manage your finances. As a general rule of thumb, you should not be spending money that you do not have unless it is a necessary cost. Dialing in your online spending will allow extra funds in your pocket and can help to ensure that you do not find yourself in debt.

Source: creditabsolute.com