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Pay Your Taxes with Plastic — and Get Rewarded?

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With tax day less than a month away, cash-strapped consumers may be tempted to charge the balance they owe to a credit card, such as through the offer above (or via the electronic payment services approved by the IRS that accept credit cards).

The promotion says you could earn rewards for every dollar you charge. The fine print, however, says:

*MOUSE PRINT: “Tax payments made with your credit card will be subject to a service fee…”  How much of a service fee?  It is 2.49 percent, or about $25 per $1000 charged.

But what about the rewards they promised?  Most reward credit cards only offer 1% back, so that would reduce your service fee to 1.49 percent or about $15 per $1000 charged. The good news is that most credit card companies will treat this tax payment as a purchase rather than a cash advance (thus giving you a 20-25 days grace period with no finance charges or cash advance charges if you pay in full every month). If you don’t pay it in full, regular finances charges will accrue on top of the 2.49 percent fee.

Some credit cards like Citi’s CashReturns card offer 5% back on everything for the first three months. Were you to use this card, you would actually make 2.5% on your tax payment.

A little known alternative to charging your taxes to your credit card is to put that charge on your debit card through a company called Link2Gov.

*MOUSE PRINT:  The fee is only $2.95, but your card must be a member of the NYCE, Star or Pulse networks.

Don’t charge more than is your bank account, or that will trigger overdraft fees, and/or finance charges from your bank.

Most experts, however, suggest paying your taxes the old fashioned way — by check. You will enjoy a week or two of float, and not pay a penny extra in fees or finance charges.

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Airborne’s Legal Remedy: Nothing to Sneeze At

airborne.jpgEveryone has probably seen the commercials for Airborne — the cold remedy “developed by a school teacher who was sick of catching colds in class and on airplanes.”

Clearly, this sounds like a product that one would take to prevent catching a cold.

Even their website back in 2001 gave that impression and more:

“Crowded environments like Airplanes, Offices, and Schools are spawning grounds for germs that cause colds and sickness! AIRBORNE’S unique natural formula of seven Herbal Extracts, Antioxidants, Electrolytes, and Amino Acids, offers maximum vitamin and herbal protection for hours! Plus its natural ginger component helps fight nausea caused by motion sickness. Take at the first sign of a cold symptom or before entering crowded, potentially germ-infested places!  [It then quotes a user as saying:] A miracle cold buster!”

And a few years later they touted the results of a clinical trial on their website.

*MOUSE PRINT: Though there is page after page of mumbo jumbo, it does suggest a reduction in symptoms by those who took Airborne. However, only 48 people actually took the product.

Fast forward to 2006. ABC reported that Airborne’s clinical trial was conducted neither by scientists nor doctors, but rather by two guys hired to conduct this particular test. The company then dropped references to it on its website.

Fast forward again to 2008. Airborne just settled a class action lawsuit claiming that the company misrepresented the product, and it agreed to pay over $23 million back to purchasers. [Get claim form here.]

The settlement agreement is lacking at least one key provision, however:

*MOUSE PRINT: There is no requirement that they refrain from making unsubstantiated claims in the future.

August 2008 Update: The FTC just entered into a settlement with the company to prevent them from making unsubstantiated health claims in the future, and to pay a total of $30 in settlement to aggrieved purchasers.

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Act Fluoride: Twice the Size, Half the Strength

actsmall.jpgWhen MrConsumer’s dentist advised him that a new cavity might be in its earliest stages of development, he checked out fluoride rinses that claim to restore minerals to weak spots in tooth enamel and prevent cavities.

The granddaddy of brands is Act, formerly owned by Johnson & Johnson, and recently acquired by a company called Chattem.

Act comes in two sizes: 18 ounce and 33.8 ounce. Luckily for MrConsumer, Rite Aid had the large size on sale last week, and there was a rebate. It was a seeming no-brainer to buy the big size.

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Upon closer examination of the ingredients label, MrConsumer found a shocker:

*MOUSE PRINT: The larger bottle has less than half the strength of fluoride compared to the smaller one.

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Now who would ever expect that a different size bottle would have a different strength of the active ingredient? In fact, if you look at the larger bottle, there is a “2x” on it. Without reading carefully, one might assume that “2x” means twice the strength or twice the size, but certainly never half the potency. A closer examination reveals that is says “2x a day”. Okay, so you can use the product twice daily.

As it turns out, the company says the smaller bottle is a once a day product, and the larger one is a twice a day product. Apparently you get the equivalent amount of fluoride using the diluted version two times a day.

Nonetheless, with such an inconspicuous but important difference, countless customers in the habit of using the product once a day may buy the large size, rinse as usual, and unwittingly not get the protection they expect.

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