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IRS Payment Options

Published on: Published in: Taxes

IRS payment options

There is a variety of options for taxpayers when paying their taxes. The IRS has also tried to comply with Covid-19 regulations by encouraging less in-person payments. They had also given extensions for filing taxes for the year 2019 income tax liability and 2020 tax estimates until July 15th, 2020.

So, what are the payment options available?

Due to the ongoing pandemic, taxpayers are encouraged to prioritize the use of electronic methods. Individuals have the option of using Direct Pay where they are allowed to payments each day. The advantage of using this method is that it lets you make payments online directly from your savings or checking account for free. They also allow you to schedule payments for up to a year in advance.

Alternatively, you can make payments using tax software inline. Your tax preparer can also make payments on your behalf using Electronic Funds Withdrawal. This is an integrated system that is only open to registered tax preparers or when you are using tax preparation software.

You can use other digital payment options such as debit and credit cards and digital wallets (Cashapp, Pay Pal, Venmo, etc). They are a secure way to make payments that incorporates already existing businesses and service providers. Although convenient, the drawback to using digital payments is that processing fees may apply. It is important to note that the IRS does not keep any of the processing fees. These go to the respective service providers.

Can I still use cash or check?

Of course! You can still make payments using cash, money order, or check. The process is a little different if you choose to use what are considered the traditional methods of making payments. There are certain things you need to double-check when mailing payment. These are:

  • Make sure the check or money order is payable to the US treasury.
  • Any amounts on the check or money order should be written using numbers(For example, $456.89)
  • Ensure the check or money order carries all your details and that they are correctly entered. This includes your name and address, daytime contact information, tax year, related tax form number, and your social security number.
  • Do not use staples or paper clips to secure your payment to the voucher.
  • Mail your payment to the correct address. Do not send cash through the mail.

Cash payments are made at participating retail stores. It takes between five and seven business days to process your payment, so any plans should be made with this in mind. It is also important to note that cash payments have a daily limit of $1000. They also carry a $3.99 fee for each payment. There are four steps to follow when making cash payments. These are:

  1. Start by visiting the Official Payments Website and following the instructions. Payment is made with PayNearMe.
  2. You will get an email confirming your information. This comes from Official payments. The IRS will then take between two and three days to verify your information.
  3. After your information has been verified, you will receive an email from PayNearMe that has a link to your payment code and further instructions. Print this code out or store it in your phone.
  4. Go to the store listed on your PayNearMe email, and ask the clerk to enter your payment code. Make your payment to the store and make sure you get a receipt. These receipts are an official tax record and should be kept safe. Please note that it takes at least two business days for your payment to reflect in your account.