When to Pay Your Taxes
Federal taxes are typically due in April each year. You can pay your taxes by filing your tax return online, by mail, or by check.
Requesting an Extension
You can obtain an automatic extension of time to file your tax return by submitting Form 4868 to the IRS before the tax return filing deadline. This extension gives you until mid-October to review your return carefully and verify its accuracy, to allow someone else to do so on your behalf, or to look for ways to reduce the amount owed.
Tax Payment Options
You can pay any tax amount you owe online, send a check by mail, or request relief from the IRS if you are in financial hardship.
Federal Tax Payment Electronic System
The Electronic Federal Tax Payment System (EFTPS) is a web service managed by the U.S. Department of the Treasury for processing federal tax payments. You must set up a profile account using your banking information and wait to receive credentials by mail. Once your account is set up, the site saves your account information, so you won’t need to enter it every time you make a payment. For this reason, EFTPS is particularly useful for those who need to make estimated quarterly tax payments, such as self-employed individuals.
Direct Payment
The IRS also offers a Direct Pay service, which is an easier web service for making quick payments. However, this site does not store your banking or personal information, so you will need to enter all this information each time you want to make a payment.
Debit or Credit Card or Digital Wallet
If you wish to pay by debit or credit card or use PayPal or another digital wallet, you will need to go through an authorized payment processor. There are three processors, and a processing fee is charged by all of them. The fees vary by processor and type of payment. You can access the processors through the IRS website.
Check
You can also send your money to the IRS the traditional way: by sending a check by mail. The IRS has different addresses for payments depending on the nature of the payment and your location. You can find a complete list of addresses on the IRS website to help you determine which address to use.
Setting Up a Payment Plan
The IRS offers payment plans if you cannot pay the full amount due immediately. The important thing is not to ignore your situation, hoping that it will go away because it will not. You can set up a monthly installment agreement with the IRS, allowing you to pay the amount due in stages. You can even specify the amount you want to pay each month, at least to some extent. The balance must be paid off in full within 72 months in most cases, so the minimum monthly payment amount will be the amount due divided by 72. Leave some room for interest and penalties when doing your calculations.
Other Tax Payment Options
Depending on the amount owed and your credit rating, you may want to consider private loan options if you cannot pay by the tax deadline. You may end up paying more interest in this regard. However, these options will allow you to pay off your tax debt and avoid a payment plan with the IRS. Use a loan calculator to determine if this option is right for you.
Frequently Asked Questions
How do you pay estimated quarterly taxes?
You may need to pay estimated quarterly taxes to avoid a penalty payment at the end of the year if not enough tax has been withheld from your wages or if you received income from self-employment or another source that does not withhold taxes on your behalf. Use Form 1040-ES to calculate estimated taxes, then submit your payments by mail or through the IRS’s EFTPS online payment portal before the quarterly due dates.
How
Do you pay state taxes?
Each state has its own agency to handle tax return submissions and payments. Check your state agency’s website for more information on how to file your return and pay local and state taxes.
What happens if you don’t pay taxes?
You may be subject to penalties and interest on the unpaid balance if you don’t file or pay your taxes on time. The longer you wait to pay, the more interest you’ll accrue (penalties can reach up to 25% of the amount owed). The IRS can take additional collection actions if you accumulate a large enough balance, such as placing a lien on your bank accounts or home. Contact the IRS promptly to arrange payment and avoid these penalties if you think you might have trouble paying your taxes.
Source: https://www.thebalancemoney.com/owe-taxes-how-to-pay-the-irs-3974000
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