Three Most Frequently Asked Questions About Paying the IRS

Working with the IRS can be difficult. If you are trying to make a payment to the IRS, you may find that you cannot even get the IRS to accept your payment. Here are the three most frequently questions clients ask us about making payments to the IRS.

When Must Taxes Be Paid?

Income taxes are generally due at the time fixed for the filing of the tax return. This does not include any extension of time for filing the tax return. Other taxes are generally due upon notice and demand from the IRS. There are specific rules for how the IRS is to provide this notice and demand, which usually consists of mailing a letter to the taxpayer’s last known address.

How Do I Pay or Remit My Taxes?

Taxes must be paid by a commercially acceptable method. This includes credit or debit cards and electronic payments made using the Electronic Federal Tax Payment System (“EFTPS”).

When remitting payment to the IRS, it is important to note the difference between payments and deposits. A taxpayer can make a deposit with the IRS to stop the accrual of interest on a disputed tax debt and later designate that remittance to be a tax payment. The rules for deposits are set out in Rev. Proc. 2005-18

Rev. Proc. 2002-26 explains how the IRS applies undesignated partial payments and involuntary partial payments among periods and also how it applies a partial payment within a period among tax, penalty, and interest.

Where Do I Pay the IRS?

The place for paying tax shown on a return is generally the place fixed for filing the return.

The IRS may require that payment of certain taxes be made to authorized government depositories, however. The primary depository taxes include employment taxes, certain excise taxes, corporate income and estimated taxes, and taxes withheld on nonresident aliens and foreign corporations.

The frequency of the deposits is based on the volume of the deposits.

For deposits made on or after January 1, 2011, depository taxes must be paid by electronic funds transfer (e.g., EFTPS). Previously, deposits were made to financial institutions using paper coupons with only large depositors being required to pay by electronic funds transfer.

We help taxpayers solve their IRS problems. We would like to hear from you. Please contact us today to schedule an appointment to see how we can help.