New Payment Options for Last Minute Tax Filers; NY State & IRS Tax Payments Can Be Made By Credit Card, Via Internet & Telephone; Taxpayers Can Earn Miles By Paying Taxes

Business Wire, April 3, 2001

Business Editors

STAMFORD, Conn.--(BUSINESS WIRE)--April 3, 2001

With less than two weeks to go before tax day, the question on most taxpayers' minds is "Do I owe the government, or does the government owe me?" This year, taxpayers who owe either the IRS or the state of New York have a new alternative to writing a check: paying by credit card and perhaps earning frequent flyer miles for paying taxes. This service is provided by Official Payments Corporation (NASDAQ:OPAY), which is authorized by the IRS and the state of New York to accept credit card tax payments.

Taxpayers can use Official Payments to make IRS and New York tax payments using American Express, Discover Card and MasterCard over the telephone at 1-800-2PAY-TAX(SM) or via the Internet at www.officialpayments.com. In partnership with the IRS e-file, the systems accept credit card payments for IRS Form 1040 Balance Due Payments, Form 4868 Extension of Time to File, and Tax Year 2001 Form 1040ES Estimated Payments. On the state level, New York's Department of Taxation and Finance accepts credit card payments for Personal Income Balance Due, Form(s) IT-200, IT-201 or IT-203 and Extension of Time to File, Form IT-370. New York State is scheduled to begin accepting credit card payments for Estimated Income Taxes on May 15, 2001.

Official Payments will charge taxpayers a convenience fee of 2.5% of their tax payment for the service. For example, a taxpayer who makes a $500 tax payment would be charged a total of $512.50; $500 for the tax payment, and a 2.5% fee, or $12.50, to cover the cost of the service. Taxpayers using credit cards with bonus rewards programs can, depending on their card's program, earn rewards, points, and cash-back or airline frequent flyer miles for paying their taxes.

Some tax experts have recommended the credit card tax payment option to their clients. "It enables individuals to manage their cash flow. Also, for people who are interested in using mileage to do some free traveling or receive an upgrade, it's a great opportunity to effectively buy mileage. You get 45 days or so of float if you plan your credit card payments carefully," said Doug Stives, CPA and tax partner at Wiss & Company, a national accounting firm. "If I'm paying $10,000 on my credit card for income taxes, it's going to cost me $250. If that $10,000 pushes me to where I can now afford a trip to Hawaii, that's a great investment," Mr. Stives added.

Note to assignment editors and bookers:

Official Payments spokespersons are available for interviews on the specifics of the credit card tax payment option. The company also has produced a Video News Release on the credit card payment option. Feed information follows:

FEED DATE: TUESDAY, APRIL 10, 2001 RE-FEED TIME: 1:00 - 1:30 PM ET (FED IN ROTATION) COORDINATES: C-BAND: TELSTAR 6 (C)/TRANSPONDER 8/AUDIO 6.2 & 6.8

For additional information, please contact Bruce Zanca, Senior Vice President / Communications, at 203/356-4205 or bzanca@officalpayments.com.

About Official Payments Corporation

Official Payments Corporation (Nasdaq:OPAY) is the leading provider of electronic payment options to government entities. The company's principal business is enabling consumers to pay their government taxes, fees, fines, and utility bills by credit card, via Internet and telephone. The company is unequaled in market penetration and national footprint. Official Payments is the incumbent in agreements with the Internal Revenue Service, 17 state governments, the District of Columbia, and well over 700 county and municipal governments in 44 states across the United States. In 2000, Official Payments collected and processed over $925 million in federal, state, and local government payments.

Official Payments was founded in the San Francisco Bay area in 1996. Thomas R. Evans, the former President & CEO of the Internet company GeoCities, became Chairman & CEO of Official Payments in the summer of 1999. Mr. Evans brought Official Payments public in November of 1999, raising $80 million in its IPO on the NASDAQ national market. The company has experienced rapid and sustained growth over the past six reported quarters in revenue, new client acquisition, and addition of incremental services to existing clients. The company's success can be attributed to the combination of an enormous market opportunity with a highly skilled and experienced management and staff, aggressive sales and marketing, and a core competency in developing and implementing leading-edge technical systems.

Note: Official Payments Corp. and the Official Payments Corp. logo are service marks of Official Payments Corporation.