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If you missed the April 15 deadline to pay your taxes, many payment services remain available year-round. The IRS recommends paying as much as you can, as soon as you can, to avoid racking up penalties and interest.
Taxpayers who use guided tax-prep programs or IRS Free File might be familiar with electronic funds withdrawal (EFW). This method of payment is built into most software and lets you send a payment straight from your bank account when you file your tax return.
If youre looking to tackle your federal tax bill another way, the IRS suggests sticking to an online tax payment method, such as Direct Pay or a credit/debit card, before resorting to mail. Still, a few more payment options, including same-day wire and cash, are available.
Click on each IRS payment option below to learn more about common ways to pay your federal income taxes, what each option might cost you, and the pros and cons of each approach.
It’s that time of year again – tax season. As Americans complete their tax returns, many will owe money to the IRS. Paying taxes can feel like an unpleasant task, but it doesn’t have to be painful. The IRS offers several convenient and easy payment options to suit different needs and preferences. In this article, we’ll explore the top 10 ways to pay your tax bill so you can choose the best method for you.
1. Direct Pay
One of the fastest and simplest ways for individual taxpayers to pay the IRS directly from a bank account is through the IRS Direct Pay service. This free online option allows you to schedule a payment immediately or up to 365 days in advance. You’ll need to provide personal information like your Social Security number and date of birth to verify your identity. Direct Pay enables you to receive email notifications about your payments and gives you the ability to modify or cancel a payment up to two business days before the scheduled payment date. It’s available 24/7, providing flexibility. The only downside is you can’t make payments from international bank accounts.
2. Electronic Funds Withdrawal
Electronic Funds Withdrawal (EFW) lets you set up an automatic debit from your bank account to pay your tax bill when you e-file your tax return using tax preparation software or a tax professional. You can schedule one or more payments up to 365 days in advance if you file your return before the deadline. After the deadline, payments must be taken out the same day you e-file. If the IRS takes out the wrong amount of money from your account, you’ll have to wait for it to be sent back to you. The IRS will also give you 7–10 days to cancel a payment after they accept your return.
3. Electronic Federal Tax Payment System
The Electronic Federal Tax Payment System (EFTPS) is a free service you can use to pay federal taxes right from your bank account. While it takes around 5 days to enroll, this option allows you to schedule tax payments up to 365 days ahead. You can modify or cancel payments 2 days before they are scheduled. EFTPS also provides a payment history and customer service reps to help with any issues. The biggest con is that initial setup takes longer than Direct Pay.
4. Credit or Debit Card
Using your credit or debit card to pay the IRS is quick and convenient. While the IRS doesn’t charge a fee, you will pay processing fees ranging from 1.87% to 1.99% of the payment amount to authorized third-party processors. Fees for debit payments are around $2.50 to $3.95 per transaction. This method works for last minute payments, but the fees can add up, especially on large amounts. You’ll also need to contact the processor directly to cancel a payment.
5. IRS2Go Mobile App
For taxpayers on the go, the IRS2Go mobile app offers a few different payment options. You can use Direct Pay for free bank account transfers or make debit/credit card payments for a fee right from your smartphone or tablet. The app also generates login security codes so you don’t have to wait for texts. While the selection is limited compared to the IRS website, IRS2Go provides mobile-friendly payment flexibility.
6. Check or Money Order
Mailing a physical check or money order payable to the “United States Treasury” is still an option for paying the IRS. You’ll need to include payment voucher Form 1040-V and follow mailing instructions based on whether you’ve filed your return yet. A mailed payment takes time to process and doesn’t allow you to schedule payments in advance. However, it works if you don’t have a bank account. One downside is the risk of a check bouncing if funds aren’t available.
7. Same-Day Wire
It is easy and safe to send your tax payment through a same-day wire transfer through your bank or a nonbank provider. To use this method, you need to fill out a unique IRS worksheet for each tax payment and bring it to your bank so they can make the transfer. Wires are faster than mail, but there are fees and you have to fill out a new form for each payment. Once wires are processed, they can’t be undone.
8. Cash
Believe it or not, cash is an accepted form of IRS tax payment. You’ll need to visit an IRS-approved retail partner such as CVS, 7-Eleven, or Kroger and present a special barcode available through the IRS website. These locations charge a small service fee to process the cash payment. You can also pay with cash at some IRS Taxpayer Assistance Centers with an appointment. While not the most convenient option, cash payments work if you can’t use traditional financial accounts.
9. Installment Agreement
If you can’t pay your IRS bill all at once, you might be able to get a payment plan that lets you pay over 6 to 72 months. Long-term plans have higher requirements and higher fees than short-term agreements. Apply online or complete Form 9465. This choice stops any more fines and gives you time to pay. However, interest continues accruing until the balance is paid off.
10. Offer in Compromise
If you are having a hard time financially and can’t pay your tax debt, the IRS Offer in Compromise program may help you by letting you settle for less than you owe. You’ll have to show that you can’t pay, so this option has strict rules about who can use it. If approved, the IRS agrees to forgive some of your tax debt after you pay the agreed-upon lower amount. This program gives taxpayers who are having a hard time a fresh start.
The days of physically writing checks to the IRS are gone. Today’s electronic payment options make settling your tax bill easier than ever. Choose the method that best matches your needs and preferences. Just be sure to pay your taxes on time, whether in full or making the first installment payment, to avoid unnecessary penalties and interest. With flexible solutions now available, there’s no reason to fear tax day.
Credit card
You can pay your taxes with a credit card. It follows the same process as paying with a debit card; however, instead of paying a flat processing fee, your credit card payment will be subject to a fee in the form of a percentage. This means the more you owe, the higher your fee will be. This is the IRS’s payment processor fee comparison table. It shows what kinds of fees you can expect for each type of payment. Pay Your Taxes by Debit or Credit Card or Digital Wallet. Accessed Sep 17, 2024. View all sources.
To make a credit card payment, go to the website of one of the IRS’ three independent payment processors, then provide the payment amount, your card information and other data. The processor sends the money to the IRS.
Cost: From 1. 82% to 1. 98% of your payment; minimum fee ranges from $2. 50 to $2. 69 (the fee goes to the processor, not the IRS).
- Can be done online or over the phone.
- Card types that work with it: STAR, Pulse, NYCE, Cirrus, Accel, AFFN, Interlink, Shazam, Maestro, Jeanie, and more [list of cards]. You can also use on-line wallets like Venmo, PayPal, and Click to Pay.
- Most of the time, fees cancel out any miles or other rewards you get for using your credit card.
- If you carry a balance on your credit card, you may have to pay a lot of interest.
- Putting a lot of debt on your credit card might hurt your credit score.
- To cancel a payment, you need to get in touch with the card processor.
- Your information goes through a third party.
Electronic funds withdrawal (EFW)
If you use IRS Free File or another tax-prep software to file your federal taxes, this e-pay feature is usually offered directly through the e-filing program. To make a payment, youll enter your banking information to authorize a direct debit withdrawal. In addition, if your tax preparer e-files for you, you can ask them to send your payment through EFW.
If you pay your EFW bill after the tax deadline, you’ll have to do so on the same day you file your taxes. Theres no option to schedule a payment for a later date after the tax deadline has passed.
Cost: Free. Check with your bank for associated fees, though.
- It can be done online with tax software or by having a tax preparer do it for you.
- The Internal Revenue Service says it can also be used to estimate quarterly taxes and make some business payments. Electronic Funds Withdrawal for Businesses. Accessed Sep 17, 2024. View all sources.
- Payments for individuals and some business payments can be set up until the due date of your return.
- For each payment, you can use a different bank account.
- You might have to wait for the Treasury Department to return the money if the wrong amount was taken out.
- You have to wait seven to ten days after your return is accepted before calling the IRS e-file payment services hotline to cancel a payment. Pay Taxes by Electronic Funds Withdrawal. Accessed Sep 17, 2024. View all sources.
- You can’t change the payment amount or account information once the IRS accepts your return. You’ll have to delete the payment and choose a different method instead.
How to make a tax payment online to the IRS
FAQ
What is the best way to pay an IRS bill?
Electronic payment options are the optimal way to make a tax payment. All payment options are available at IRS. gov/payments.
What forms of payment are accepted for taxes?
We offer convenient payment methods for those with current and past due liabilities. If you are filing a return, you can pay any taxes or fees due at the same time. Payments can be made directly from your bank account, credit card, check, or by money order.
Where can I pay my taxes that I owe?
Three Ways to Pay Pay your taxes online at www. eftps. gov, over the phone, or through your tax professional, payroll service, or financial institution.
