If automated credit card payments process on the next business day after a weekend or holiday due date, credit card issuers do not report them as late to credit bureaus. Personal finance columnist Liz Weston reported this guidance in the Los Angeles Times, addressing consumer concerns over falling credit scores caused by automated billing timelines.
Weekend Payment Processing Rules and Credit Scores
When a credit card payment due date falls on a weekend or a holiday long weekend, automated payment systems process the transaction on the following business day. According to the reporting by the Los Angeles Times, these delayed-processing payments are not considered late by card issuers. Furthermore, credit card companies do not report an account as delinquent to credit bureaus until a payment is 30 days or more overdue. While a payment arriving a few days past the due date can trigger a late fee from the bank, it does not impact a consumer’s credit scores.
Continuous credit score drops over a period of a year point to deeper financial discrepancies rather than weekend payment timing anomalies. The Los Angeles Times noted that persistent score reductions often signal identity theft. If an unauthorized individual opens a credit card in a consumer’s name and defaults on payments, the resulting missed monthly payments cause continuous score declines over time.
Checking Credit Reports and Correcting Identity Theft
Consumers experiencing unexplained score drops need to examine their credit profiles immediately. The Los Angeles Times advised obtaining free copies of credit reports from the official site AnnualCreditReport.com. Borrowers must watch out for third-party sites attempting to sell credit monitoring services or other products.
Discovering fraudulent accounts requires a specific multi-step remediation process:
- File an official report with the Federal Trade Commission to obtain an identity theft affidavit.
- Use the affidavit to file a local police report documenting the fraudulent activity.
- Dispute the unauthorized accounts directly with the three major credit bureaus.
- Place a security freeze on credit reports through the bureau websites.
Additional guidance for victims of identity theft is available through the Federal Trade Commission at IdentityTheft.gov and the Identity Theft Resource Center at www.ididtheftcenter.org, as detailed by the Los Angeles Times.
Evaluating Tax Savings for Retirees and Charitable Contributions
Retirees managing required minimum distributions from individual retirement accounts face choices regarding charitable giving vehicles. The Los Angeles Times reported that qualified charitable distributions (QCDs) provide the maximum tax benefit for individuals aged 70½ and older. QCDs allow taxpayers to transfer funds directly from an IRA to eligible charities, satisfying required minimum distributions without increasing adjusted gross income. This reduction helps lower the taxation of Social Security benefits and can decrease income-related surcharges on Medicare premiums.
To qualify as a QCD, funds must move directly from the IRA custodian to the charity. A check issued by the custodian and made payable to the charity qualifies even if the account holder delivers it personally. Taking possession of the distribution before paying the charity disqualifies the transaction as a QCD.
Donor-advised funds operate under different rules. Taxpayers contribute cash or securities to these funds and potentially secure a tax deduction if they itemize deductions. Contributions grow tax-free until the donor directs grants to eligible charities in subsequent years. While donors cannot use QCDs to fund donor-advised funds, these vehicles assist individuals who want to bundle several years of charitable contributions at once or donate appreciated securities to avoid capital gains taxes.
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