Avoid Penalties and Interest by Utilizing Electronic Payments and Agreements
Tax season is upon us, and if you owe on taxes this year, there are several ways to pay and payment options available. Filing for an extension before April 18th will buy you extra time to file at no cost, but it’s important to remember that any payments due must still be made by the original deadline in order to avoid penalties and interest. Fortunately, taxpayers now have the option of utilizing electronic payment methods as well as payment plan or agreement options. Let’s explore the different payment options available.
Credit Card Payments
Taxpayers may use a credit card or debit card to make payments electronically. Popular credit cards like Visa, MasterCard, American Express, and Discover are all accepted. This method is convenient because it allows taxpayers to make payments quickly without having to wait for other forms of payment processing such as digital checks or paper checks. There may be a small fee associated with this method depending on the processor chosen.
Payment processing companies such as Pay USAtax allow taxpayers to pay electronically through a digital check system via their bank accounts. This method does not require any additional fees, however there may be a delay in processing depending on the company chosen. Digital check payments usually take between two and five business days for funds to clear into the IRS account from when they are submitted online. It is also important to double check routing numbers when submitting digital checks in order to ensure accuracy in processing times.
Payment Plans or Agreements
Yay! You can get help with your taxes - even if you don't qualify for free filing options! Taxpayers who cannot afford full payments may apply for either a partial-payment installment agreement or an offer in compromise (OIC). These agreements will help reduce total penalties and interest owed over time by allowing taxpayers to make smaller monthly payments until their debt is cleared. The IRS has information about these types of agreements online so taxpayers can determine which one best suits their needs according to their individual financial situation. Nowadays, most of these agreements can be done completely online without ever having to step foot inside an IRS office location!
The Internal Revenue Service currently offers many different electronic payment options that can help reduce total penalties and interest charged on tax debtors who cannot afford full payments right away. It’s important for all taxpayers who owe money this year due by April 18th that they do their research on the various electronic payment methods available so they can choose one that best meets their financial needs while avoiding penalty fees and additional interest charges associated with late payments or missed deadlines altogether! By taking advantage of these electronic payment options offered by the IRS, taxpayers can rest assured knowing they won’t have any surprises come tax season next year!