The IRS has released ten tips for paying your taxes.
1. Never send cash
2. If you e-file, you can file and pay in a single step with an electronic funds withdrawal. Our tax software has settings that allow an electronic payment from your checking or savings account.
3. Taxes may be paid electronically using the IRS.gov website by clicking on the “payments” tab.
4. Payment may also be made by check or money order.
5. You may also make a payment using a debit or credit card. There is a processing fee for this service.
6. The processing fee is deductible on Schedule A as a miscellaneous itemized deduction subject to the 2% floor.
7. Be sure to write your name, address and phone number on the check. Also include tax year, IRS form number and Social Security number.
8. Complete Form 1040-V, the payment voucher for individual taxpayers and mail it with your tax return and tax payment. This will help the IRS process your payment and post it to your account. One should be included with your return. If not, one can be printed from IRS.gov.
9. Do not staple payment to any tax form.
10. For more information, call 800-829-4477, topic 158. Also you can read the instruction included with the form 1040-V.
While a number of our clients have their refunds electronically deposited in their accounts, we have yet to have anyone ask for electronic payments. Most say they don’t trust the IRS. Those of you hoping to earn air miles by paying your taxes via credit card, the processing fees range from 1.87-2.35% all but wiping out any points you would earn and unless you pay your credit card balance in full each month, the higher credit card interest rates make this a losing proposition. If at any time you have questions regarding the payment of your taxes, please be sure to contact us at 503-244-8767.