Many taxpayers are getting a refund this time of the year but it doesn’t apply to everyone. You only get a refund if you had withholdings throughout the year, but those who are self-employed, run a small business, or minimize the amount of withholdings on their W-2s may have a tax liability.
To facilitate a payment of a tax liability or payment of estimated taxes, the IRS makes sure there are enough tools in place to make this process as easy as it gets. After all, the less complicated it is, the faster they get the money.
So, what are the options to pay your IRS taxes?
There is a number of payment options for you to pay the federal tax bill. You can pay online, by phone, or using the IRS2GO app.
Online payment can be done with IRS Direct Pay. It allows to settle your obligations related to any of the 1040 forms at no additional cost to you. The payment is made directly from your checking or savings account.
First step is to select a reason for payment. Some of the options include: tax return or notice, estimated tax, installment payment, amended return, etc. Select a form to which the payment applies and lastly the tax period for the payment. For security reasons, there is an identity verification process that requires information from the tax returns you had filed in prior years. Currently, any tax return you have from 2013 to 2017 is enough to satisfy this requirement.
When using the mobile app to make a payment, you gain access to direct pay and select a checking or savings account to complete the payment. If you choose to pay the bill with the funds in your checking or savings account, you will be redirected to Direct Pay and follow the same process as mentioned above.
When making payments using a credit or debit card, the IRS gives you a choice of 3 payment processors. Those vendors handle personal and business taxes and even let you set up future payments. Note that depending who processes the payment, there may be fees attached to it. Debit cards typically have a flat fee of less than $4.00. Credit cards have fees that are a percentage of the amount of payment with a certain minimum amount. For more information on the fees, click here. You can also use your credit card to make a payment on the IRS.gov.
A side note, IRS2GO app lets you track your refund. It requires a social security number, filing status, and the refund amount.
Last but not least, you can pay by phone. The payments are handled through the IRS approved processors that accept credit and debit cards and digital wallets. Fees may apply when resorting to this method.
Remember that you don’t have to make a payment at the time of filing your taxes. Assuming of course that you didn’t wait until the deadline, which this year is on April 15, 2019 for 2018 returns. You can file your taxes early and make a payment before or on April 15. Making a payment on time ensures you avoid penalties and interests.