Owe Taxes but Don't Have the Money?
File something - tax return or tax extension - even if you can't pay anything by Tax Day!
Don't panic; we at eFile.com are here to help. Sign up for a free eFile.com account to prepare your return each tax year! The eFile Tax App takes care of all the complicated forms for you. Compare eFile.com to TurboTax® or H&R Block® and see how we practice personalized support for all your tax questions.
Before we assist in finding ways to pay your taxes owed, ask yourself these 3 questions:
1. Are you going by a "gut feeling" about owing taxes or have you just completed a tax return and found out that you owe taxes?
2. What is the true cause of you owing taxes now: either by your gut feeling, as a result of estimating taxes, or completing a tax return?
3. Are you prepared to make changes now or in the future so you can avoid owing taxes on Tax Day each year? Make more accurate estimated tax payments or withhold more from your paycheck via Form W-4.
First, consider your payment options based on the table below.
If you have the funds to pay your due taxes now
via digital check or direct bank transfer, you can do this online by going straight to the IRS. Select this option to pay estimated taxes
, due taxes when you file, or to make a tax extension payment
. Elect to receive an email confirmation when you pay so you know that your tax payment was accepted. This method is simple, safe, secure, does not have any fees, and usually only takes 1-2 business days to process your payment.
To use a debit card, credit card, or digital wallet to pay any due or expected taxes, use this IRS link. There are small fees associated with this method as outlined on the page, depending on which service you use and which type of payment is submitted. These are done through third-party platforms which let you use popular debit and credit cards, including Discover and American Express.
If you do not immediately have the funds to pay due taxes, then you may be able to apply for a payment plan or installment agreement with the IRS if certain criteria are met. This will allow you to pay your taxes over time rather than in one lump sum with your return. Use the link to see if you qualify and begin the process of applying for this relief.
Just need to pay your taxes and be done with it? If you already know the amounts you want to pay to the IRS and/or state, use these quick links:
Pay IRS Taxes Online | Pay State Taxes Online
The most important thing you can do is to file your taxes on time for the upcoming tax season. 2022 Taxes are due April 15, 2023, but if you miss this deadline, you will have until October 15, 2023 to e-file your returns. If you owe taxes, at the very least, file for an extension - this is not more time to pay, but may reduce or eliminate your late filing penalty. If you file after the deadline, late filing and/or late payment penalties might occur, but they will be much less the sooner you file and/or pay. Most taxpayers don't know that the late filing penalties are considerably higher than the not paying on time penalties; file even if you can't pay!
How to Pay IRS Tax Debt
What if you can't pay your taxes? While there are ways to legally reduce your taxes, if you owe tax when you file your return, you will need to pay this tax liability. The simplest and safest way to pay federal taxes online is directly to the IRS - you can make these payments at any point during the year and opt to receive a confirmation email or text both when your payment is initiated and when the payment is actually taken out of your account. Pay the IRS directly online with credit card or directly from your bank account - there are additional third-party platforms you can use to pay IRS taxes online if you want to use a different method, like a digital wallet (PayPal, etc.). You can pay taxes online for Form 1040, 1040-ES, 4868 (see tax extensions), and more.
Depending on your situation, attempt to pay some of your tax debt off in order to reduce penalties: see how to pay taxes online. You can also pay through your eFile account when you e-file your return - see our checkout guide which shows step-by-step eFile instructions for finishing and filing your return. You may also qualify for IRS tax debt forgiveness in the form of an Offer in Compromise. This IRS debt forgiveness program may allow you to reduce or eliminate your debt.
Review your Rights as a Taxpayer
- the Taxpayer Bill of Rights is composed of ten items which secure your right to be informed of the rules and regulations of filing and paying taxes, the right to pay only the amount of taxes you should owe, the right to challenge any IRS adjustments or actions, and more.
Life situations can come at us fast; an emergency or other event happens and it can become hard to pay for taxes. However, it is important to try and establish payment to the IRS, even if it is a small payment or a payment plan. What happens if you don't pay taxes: If enough time passes, the IRS obtains the legal right to claim your assets and property - a lien - and even the right to seize said property or even garnish your wages - a levy - often done through an IRS audit. The chances of an audit are under one percent; report your information accurately and honestly to avoid being audited by the IRS.
This is generally for more extreme cases; if you miss a small tax payment or owe $500 that is five months overdue, the IRS is not going to threaten you in any way. They will first issue you a series of letters alerting you of your balance plus giving you options to pay. These may be IRS Letters CP14, CP23, CP90, and more. The best way to handle these is by contacting the IRS via the information on the letter to try and work with them to pay your taxes if you do not immediately have the funds. If you do have the funds, however, then you can just pay federal taxes online using the balance on the notice.
Important: The IRS will never initiate contact over phone or email and use threatening language.
Even if your "gut feeling" is correct about owing taxes, you must get the facts first by following these steps on how to see how much tax you owe:
- Use Our Free Tax Tools: Carefully examine your tax situation with these easy to use, personalized tax tools. Determine your filing status, see if you qualify for different credits, and plan your tax withholding.
- Discover Tax Deductions and Credits: Review available IRS/Federal tax deductions and tax credits. These may help reduce your taxes owed or even turn your tax liability into a tax refund.
- Estimate Your Taxes: The eFile.com Tax Return and Refund Estimator generates a personalized tax return for you. Get an idea of what your return may look like before you prepare and eFileIT.
- See If Tax Penalties Apply to You: IRS Tax penalties for not filing are higher than penalties for not paying. Find out potential IRS tax penalties and use the PENALTYucator to estimate how much could be owed based on your tax situation.
- e-File or File Your Tax Return or Extension by Tax Day: As you can see in point 4, not filing a tax return or extension (even if you cannot pay your taxes now) is more costly in terms of potential penalties than not paying your taxes now. Use eFile.com to start and e-file your tax return or at least a tax extension by Tax Day. If you miss the Tax Day deadline or e-Filed an extension, your next eFile deadline is usually on October 15 of the current Tax Year. Be aware that an extension does not give you more time to pay any taxes owed.
- Ready to Pay Your Due Tax: Once you have estimated, prepared, or filed your return, you will want to pay your due tax if it is owed. There are multiple ways to pay taxes owed; if you prepare your return on eFile.com, you are given the option to pay with your return. e-File your return and submit a payment to reduce your potential penalties. You can elect not to pay with your return by making a payment on your own directly to the IRS. There are also third party sites to make payments; we generally recommend paying with your return on eFile or making a payment directly to the IRS via their online payment portal . See below for more information on paying tax if you cannot pay in full, such as an IRS payment plan, installment agreement, or offer in compromise. Tip: Use form 9465 to request an installment agreement.
- File Your Tax Return for a Previous Tax Year: You can only prepare and e-file a tax return or extension for the current tax year. For previous years, you must complete the tax return forms manually and mail them to the IRS. You can find and download the tax forms by tax year here. If you owe back taxes to the IRS, try to pay some or all of this as soon as possible.
Once you have completed these steps, you will now know for a fact how much taxes you owe. Again, it's most important that you have e-filed/filed your return as soon as possible. Take note of this tax season timeline - here, find important dates to keep in mind. Filing and payment deadlines can be found there which can help plan your options to pay your due tax.
Tax Payment Estimates
The most accurate way to find out taxes owed or due is a tax return. However, there are many other scenarios that require to plan and/or estimate taxes prior to filing a return or paying taxes. Prepare your 2022 Return now to get the most accurate figure - sign up for a free eFile account here. You do not have to e-file your return immediately, but use the eFile Tax App to prepare your 2022 Return in real time to see what taxes, if any, you may owe.
Estimate your 2022 Taxes
first before you prepare and e-file your income tax return; see what your taxes owed or tax refund may be based on real IRS data.
Make payments through the year if you expect to owe taxes - make these online to get a confirming and tracking number rather than mailing Form 1040-ES. You can make estimated tax payments for 2022 through January 15, 2023 - the first 2023 payment will be due April 15, 2023.
The eFile.com PAYucator can help with planning your paycheck tax withholding by pay period - balance your withholding by paying enough income taxes with each paycheck, but not too much only to get it back as a refund.
Use the eFile.com W-4 TAXometer when you are planning your multi job or income tax withholding for the given tax year - fill out a 2023 W-4 now.
Define your personal tax return goals as they are the basis for your tax withholding and tax estimate payments for the given tax year.
Find resources for previous year or back taxes if you did not file or e-file a past tax return by the tax year deadline; start here if you are filing multiple year returns.
As stated above, late filing penalties are generally higher than late payment penalties; find out for yourself. Currently, we only have a tool to estimate IRS penalties and not state penalties.
Need more tax help on ways to estimate or your taxes? Contact one of our Taxperts®
by creating a free eFile account
for faster, more personalized support.
Tax Payment Options
Pay your due tax as you are able to via these tax payment options. Everyone's tax situation is different; consider your options:
- Pay Via the eFile.com Platform During e-filing: When you prepare and e-File via eFile.com, we offer electronic payment options within the software app. We recommend you pay as little or as much as you can in order to minimize failure-to-pay tax penalties.
- Make a Direct Payment to the IRS: After e-filing, you can elect not to pay with your return. Visit the IRS payment page and make a payment to the IRS via debit/credit or bank payment - you can pay taxes with a credit card. Pay the IRS using the amount on your return you prepared on eFile.com - pay as little or as much as you can! See our states page for links to individual state sites as most allow you to pay online as well.
- IRS Tax Payment Plans: If you can't pay in full or can't pay any money, consider these payment plans for IRS taxes you owe. In certain cases, the IRS will help taxpayers set up a plan to pay their due tax over time if they cannot immediately afford it.
Tax Balancing and Minimizing Tax Payments
Owing tax or being owed a refund is all based on withholding during the year. eFile.com has made the federal Form W-4 as simple as possible with online tools and calculators. Start here:
Ways to Obtain Money to Pay Taxes Owed
Whether you owe hundreds or thousands, you should really ask yourself whether you have the money to pay your tax debt. Here are some options to consider:
Be aware that the options above may only be good ideas if any interest you end up paying is less than the interest and penalties the IRS will charge you.
Take a Tax Break
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