Electronic Federal Tax Payment System

Avoid the rush: Pay taxes owed online or set up a payment plan

WASHINGTON — The Internal Revenue Service today reminded taxpayers who may unexpectedly owe additional tax that there are many online options for payment as well as online options for applying for a payment plan for those who can not pay in full.

Questions about payments and installment plans are among the top reasons taxpayers call or visit the IRS. But they can avoid the rush, especially during the peak period of Presidents Day, by using IRS.gov resources.

All taxes owed must be paid in full by the due date, which is Monday, April 15, 2019, for most taxpayers. Because of the Patriots’ Day holiday on April 15 in Maine and Massachusetts and the Emancipation Day holiday on April 16 in the District of Columbia, taxpayers who live in Maine or Massachusetts have until April 17, 2019, to file their tax returns.

Payment options

Taxpayers should review the “Pay” tab on IRS.gov to see an explanation of payment options. Taxpayers can pay with their bank accounts for free, or choose an approved payment processor to pay by credit or debit card for a fee. They can also use checks or money orders made out to U.S. Treasury.

Most tax software products give taxpayers various payment options, including the option to withdraw the funds from a bank account. As an alternative, taxpayers also may use IRS Direct Pay on IRS.gov to make an electronic payment from their bank account to the U.S. Treasury.

Some taxpayers also visit an IRS office to make in-person monthly or quarterly tax payments. But there are online options available to them as well. Those payments can be made online by using IRS Direct Pay or through the Electronic Federal Tax Payment System.

Taxpayers who owe money with their tax return but who lack the full amount should pay as much as possible to avoid interest and late-payment penalties. Taxpayers who lack the funds to pay in full can apply for a payment plan, including an installment agreement.

Setting up a payment plan

Qualified taxpayers may be eligible for several types of online payment plans such as full payment, short-term (120 days or less) or long-term (more than 120 days). A taxpayer’s specific tax situation will determine which payment options are available to them.

Taxpayers may qualify to apply online for:

Long-term payment plan (installment agreement): If the taxpayer owes $50,000 or less in combined tax, penalties and interest, and filed all required tax returns.
Short-term payment plan: If the taxpayer owes less than $100,000 in combined tax, penalties and interest.

Taxpayers interested in exploring payment plan options should review Apply Online for a Payment Plan. Alternatively, taxpayers can find out if they qualify for an offer in compromise, a way to settle your tax debt for less than the full amount, or request that the IRS temporarily delay collection until the taxpayer’s financial situation improves.

Do a Paycheck Checkup

A Paycheck Checkup can help taxpayers see if they are withholding the right amount of tax from their paychecks. Taxpayers who unexpectedly had a tax bill may want to use this feature to ensure that additional taxes are withheld for the 2019 tax year.

The IRS Withholding Calculator helps taxpayers figure out if they should submit a new Form W-4 to their employer. Taxpayers will need their most recent pay stub and their most recent federal tax return to complete the process.

Here’s how and when to pay estimated taxes

Certain taxpayers must make estimated tax payments throughout the year. Taxpayers must generally pay at least 90 percent of their taxes throughout the year through withholding, estimated tax payments or a combination of the two. If they don’t, they may owe an estimated tax penalty.

For tax-year 2018, the remaining estimated tax payment due dates are Sept. 17, 2018 and Jan. 15, 2019.

Estimated tax is the method used to pay tax on income that is not subject to withholding. This income includes earnings from self-employment, interest, dividends, rents, and alimony. Taxpayers who do not choose to have taxes withheld from other taxable income should also make estimated tax payments. This other income includes unemployment compensation and the taxable part of Social Security benefits.

The IRS urges everyone who works as an employee and who also earns or has income from other sources to perform a Paycheck Checkup now. Doing so will help avoid an unexpected year-end tax bill and possibly a penalty when the taxpayer files their 2018 tax return next year. They can do a checkup using the Withholding Calculator on IRS.gov.

Here are some things to know for taxpayers who make estimated payments:

Taxpayers can pay their taxes throughout the year anytime. They must select the tax year and tax type or form when paying electronically.
Filers paying by check should make it out to the “United States Treasury” and indicate the tax year and type of taxes they are paying.
Taxpayers in presidentially-declared disaster areas may have more time to make these payments without penalty.
For easy and secure ways to make estimated tax payments, use is IRS Direct Pay or the Electronic Federal Tax Payment System. IRS.gov/payments has information on all payment options.
Taxpayers can find more information about tax withholding and estimated tax at the Pay As You Go page IRS.gov.
Publication 505, Tax Withholding and Estimated Tax, is another resource for taxpayers. Publication 505 has worksheets and examples, which can help taxpayers determine whether they should pay estimated tax.

Avoid the rush: Pay taxes owed online or set up a payment plan

Here’s how and when to pay estimated taxes

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