Submitted By: Raeone
Answered: March 25, 2016 12:08 pm

I paid a convenience fee when I charged my property taxes. Can I deduct this fee?

It is not clear if or how you can deduct the convenience fee. The IRS addressed the question of convenience fees in connection with the payment of federal taxes. While the IRS does not charge a fee for using credit or debit cards to pay federal taxes, the credit card companies do. The IRS said the convenience fees are a miscellaneous itemized deduction. Thus you have to itemize and have miscellaneous itemized deductions in excess of two percent of your adjusted gross income to benefit from any write off. The IRS has not said whether the fee related to the payment of your property taxes should be treated similarly, but logic suggests that it should because it is a cost “in connection with the determination, collection, or refund of any tax.”

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Tax Glossary

Individual retirement account (IRA)

A retirement account to which up to $4,000 (or $5,000 if you are 50 or over) may be contributed for 2007, but deductions for the contribution are restricted if you are covered by a company retirement plan. Earnings accumulate tax free.

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