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Update: Plastiq no longer allows child support or alimony payments through their system.
Several states allow credit card payments for child support through their official programs.
Some states limit acceptance to MasterCard and Discover, others to Visa and MasterCard. Apparently New Jersey stopped taking cards altogether. And I’m not aware of any that take American Express.
But let’s assume you want to pay with American Express, or to pay the other parent directly. Perhaps you need to build up miles because your ex-spouse took them all in the divorce.
Yesterday I wrote about a special promotion from Plastiq.com to let you pay bills using a MasterCard or American Express with a fee of just 1.99% (which is much less than competitor services cost).
You’re basically buying miles at 2 cents apiece by paying your bills that you’d otherwise have to write a check or use your bank’s billpay service for. This is obviously worth it when a spending bonus (like a signup or threshold bonus) applies. But it can be well worth it with certain cards whose points-earning is valuable enough.
Reader Greg asked,
Gary, can this be used for child support and/or alimony payments?
You’re not allowed to use the Plastiq.com service for “peer to peer” payments. You can’t send money to a spouse and charge it to your card, and then have them send money back to you charged to their card.
To make sure child support and alimony are kosher, I asked the company’s CEO, and here’s what I was told:
It’s fine. The way to do it is to specify ‘other’ as the payment purpose and then type “alimony” as the reason.
More information may be requested after the transaction to document that there’s really a payment being made for a particular reason, so that Plastiq can remain compliant with their processing partners.
So there’s a chance auditing could ask for a formal acknowledgment that the amount of money is owed to the particular person for a specific reason — that way they can keep processing these types of transactions without calling them cash advances.
Finally, miles and points to make the alimony go down smoother.
Thanks Gary!!
Perfect! This is exactly the question I submitted to them yesterday!
Just remember to make ch. support and alimony as two separate payments, as you should with checks. Alimony is tax deductible and c.s. is not, so you want to keep those records clean.
I made a Plastiq rent payment a few days ago, and Chase Ink Bold categorized it as utility. However, the points have not posted yet. So, I do not know if I got 5X, but the results are encouraging.
Two updates:
1. My Chase Ultimate Rewards statement posted, and I only got 1X for my Plastiq rent payment that was categorized by Chase as “utility.”
2. I have been informed by a Plastiq customer service representative that while this article was accurate at the time it was posted, Plastiq is now not allowing alimony payments. I provided a web link to this article in my follow-up email to that representative, and he confirmed it a few hours later. I’m not trying to fool anyone into not trying. If you want to, I wish you luck and encourage you to post your results.
I want to add that Chase Ink Bold that only got 1X on Plastiq is a MasterCard. I don’t know if vendor categorization is any different for the Visa version of the Chase Ink cards.
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