How to Make IRS Tax Payments
If you owe the IRS less than fifty thousand dollars, you can pay by mail. For amounts higher than fifty thousand dollars, you can pay by cash or check. You must include a copy of your tax notice or return, and make the payment payable to the United States Treasury. In the payment, include your name, address, daytime telephone number, taxpayer identification number, tax year, and form number. For more information, visit the IRS website.
Taxpayers owing the IRS fifty thousand dollars or less
If you owe the IRS more than fifty thousand dollars, you have several options to negotiate a deal. One option is to use an Offer in Compromise, in which you and the IRS come to an agreement to settle the debt for less than the full amount owed. Use an Offer in Compromise Pre-Qualifier to help determine if this option is right for you. Another option is to borrow the amount you owe, which can be cheaper than penalties and interest.
Taxpayers owing the IRS up to $1 million
Individuals oweing the IRS up to $1 million face an increasingly difficult path to a payment plan. However, with the help of a tax resolution firm, these taxpayers can still reach a payment plan if they owe less than $250,000. This new payment plan, called an “installment agreement,” allows taxpayers to set up a monthly payment plan with the IRS. Nearly 4 million taxpayers obtained an installment agreement over the last two years.
For the first step, you must acknowledge that you owe taxes. You can do this by stating your intention to cooperate and pay the amount you owe. Do not be defensive or complain about unfair tax laws. A positive attitude will send a clear message that you are not unreasonable or unwilling to pay your debt. The IRS will then work with you to reach a payment agreement that meets your financial needs.
Taxpayers owing the IRS up to $10 million
If you owe the IRS more than $10 million and are having trouble paying your taxes on time, you may want to consider a tax payment extension. The IRS has announced that it will extend the deadline for individual and business tax payments to July 15, 2023. You still have until April 15th to file your tax return and make payments, but you can extend that date until July 15th if you owe less than that amount. The IRS will waive penalties and interest until July 15th, but you will have to make up the difference by then or face late penalties and interest.
The IRS offers a three-month deferral to corporate filers. Taxpayers can receive a three-month deferral and will not be charged interest or penalties during this time. However, they should submit their 2019 tax returns as soon as possible, as many of them may have a refund to give to themselves. In 2018, over 52.7 million filers received a refund of an average of $3,012 each, but be sure to check your state’s laws.
The Internal Revenue Service pushed the tax payments at a later date due to the coronavirus pandemic. If you owe to the IRS on your 2023 income tax return, you now must pay it until July 15, not April 15.
However, you must file your tax return by the April 15 deadline. So it remains the same for filing taxes. Same as any other year, you can file for a tax extension. You can learn more about filing for tax extension from here.
On top of the IRS postponing the tax payments to July 15, many states are also doing the same. Most recently, California pushed its tax payments deadline from April 15 to July 15. Regardless of where you’re at, we expect all states that impose income tax to follow the same.
As for filing a tax extension on your state income tax return, each state has its own differences. The only piece of advice we can give is to check in with your state’s revenue office.
There are also relieving news about tax refunds. The IRS stated that there won’t be any delays on taxpayer’s tax refunds and the agency will issue tax refunds at a faster pace so everybody gets their tax refunds as early as possible.