Federal and State Income Tax Payment Options
Scrambling to figure out how to pay the income taxes you owe? Let efile.com help! During or after the efile process, you can submit your tax payment information easily. Here you can find online tax payment options and other information on owing taxes.
Can I Wait to File My Tax Return If I Cannot Pay the Taxes I Owe?
It's important to file or efile a tax return (or a tax extension) on time to avoid penalties for failing to file by Tax Day. Even if you can only pay a small amount of what you owe, file or efile your return or extension and pay as much as you can.
What Are My Tax Payment Options?
Once you have filed your tax return or extension, you have the following tax payment options on efile.com:
- Direct Bank Transfer (only available when efiling a tax return at the same time): While you are preparing and efiling your federal tax return online on efile.com, you can enter your bank account information to pay your taxes via direct bank transfer to the U.S. Treasury. Once you submit the tax payment, your bank statement will list “US Treasury” and a PIN or access code for referencing the transaction. How to submit direct debit payment on efile.com
- Check or Money Order: You can mail a check or money order to the IRS. A payment voucher (Form 1040-V) will be generated with your tax return and you should include this form when you mail your check. The correct IRS mailing address to use is based on your state residence, and you can find the appropriate mailing address on your Form 1040-V. Make the payment to "United States Treasury" and write your Social Security number, your phone number, the Tax Year, and which tax return form you filed on the front of the check or money order (i.e. "2015 Form 1040-A"). Do not staple or paperclip the payment to the voucher.
What Are My State Income Tax Payment Options?
What Else Do I Need to Know About Owing Taxes?
The IRS provides the following tips for people that owe income tax:
- File a Tax Return or Extension by Tax Day: Even if you cannot pay all the taxes you owe, file a tax return or extension on time to avoid high IRS late filing penalties.
- Pay Your Tax Bill: If you receive a bill from the IRS, you’ll save money by paying your taxes owed as soon as you can. If you can’t pay them all at once, you should pay as much as you can. That way, you'll reduce your penalties and interest for late payment.
- Use IRS Direct Pay: The IRS website has a Direct Pay tool. It's a safe, easy, and free way to pay from your savings or checking account. The tool walks you through five steps to pay your taxes online. You can find the tool on IRS.gov.
- Get a Short-Term Extension to Pay: If you can pay all your taxes in 120 days or less, you may qualify for a short-term extension to pay from the IRS. You can apply for a payment extension online via the IRS website or by calling 1-800-829-1040 (if you received a bill from the IRS, you can call the phone number listed on the bill). Usually, there's no set-up fee for a short-term extension.
- Apply For a Monthly Payment Plan: If you need more time to pay and you owe $50,000 or less, you may qualify for an online installment payment agreement with the IRS. The IRS states that a direct debit payment plan is the best option because this plan is a lower-cost, hassle-free way to pay, and the set-up fee is less than other payment plans. In addition, you don't have to worry about reminders, missed payments, or checks to write and mail. You can apply for the monthly payment plan via the IRS website or by completing and mailing Form 9465, Installment Agreement Request.
- Consider an Offer in Compromise: You can settle your tax debt for less than the full amount that you owe by applying for an offer in compromise (OIC) with the IRS. However, you should only consider an OIC if you cannot pay your taxes in full (and cannot take advantage of options 1-4 above) or if making a full payment will cause a financial hardship. To see if you qualify for an OIC, you can use the IRS Pre-Qualifier tool on their website.
- Change Your Withholding or Estimated Tax. To avoid owing the IRS in the future, you may want to have more taxes withheld from your paycheck. You can do this by completing a new Form W-4, Employee's Withholding Allowance Certificate, and giving it to your employer. You may also need to make estimated payments if you have income that's not subject to tax withholding. To make estimated tax payments, complete Form 1040-ES, Estimated Tax For Individuals. efile it