Why pay your tax online?

I'm in no hurry to pay the taxes I owe. Last night, I did a preliminary calculation and found my husband and I more than $1,600 short, due to the abominable Alternative Minimum Tax. So I'll file electronically but wait 'til the very last day to send that check by mail.

Some folks put off the pain of paying even longer. They use services that let you charge your tax payment on your credit card. For a 2.49-percent "convenience" fee, Pay1040.com and Official Payments Corp. say they'll help. I'm sorry, but if I'm already paying $1,600, why would I want to shell out another $39.84 for the privilege of paying my taxes online? And if I've already got a balance on my credit card or can't pay the amount all in one billing period, finance charges on $1,600 could quickly balloon like the federal budget.

Ed Braswell, president of the company that runs Pay1040.com, insists people aren't using his service just to forestall the agony of paying. A majority of those polled say they use it for convenience or because they just run out of time. He doesn't mention extras like frequent-flier miles, points or other rewards, but I'd bet those figure in the equation, too.

Having more than once done the 11:50 P.M. Tax Day Mad Dash, I can relate to the desire for convenience. I also understand that for folks who don't owe nearly so much, a 2.49-percent fee doesn't seem so high. But to save $40, I'd brave the post office crush again. My advice:

•If you want to pay your taxes with a credit card because you don't have the money now, check out options that don't involve average credit-card interest rates of 13 percent. And don't fall for the rewards-points come-on from credit-card companies; the value of those points gets dwarfed quickly by finance charges.

•If you have the money on hand but like the convenience of paying online, arrange to have the funds transferred electronically from your bank account. The IRS offers a free electronic funds transfer payment system (EFTPS). It's good for periodic or once-a-year payments, but isn't for last-minute filers. Enrollment is required, and can take more than 2 weeks.

•If you're really up against the wall on the evening of April 17th, find an inexpensive tax-payment service online. This year, for the first time, Braswell's company is offering incometaxpayment.com, which lets you use popular ATM, check cards and debit cards to pay taxes electronically. It doesn't require advance registration and costs a flat $2.95 per federal form.

We've not tested the $2.95 service, but the price seems right. Given the cost of gas in my neighborhood, that sum might well equal a trip to the post office plus a 39-cent stamp.