I had to amend my 2020 taxes and now have taxes due. I would like to pay online rather than send a check with the 1040X to avoid additional interest. With the current backlog at the IRS it could be many months before they process my amended return.
Do I pay only the amount shown on the 1040X, or do I use some online calculator to estimate the interest and penalties and pay those immediately online also? I found a post that said the IRS will bill me for the interest and penalties, but how will that interest be calculated? Up to the day I paid the amount due online, or include the months it takes them to process my amended return? Do I need to include a note with my 1040X stating that I paid online or include an online receipt?
The instructions say to pay by check. My fear is they do not process the check or the return for another 6-9 months and I will owe even more in interest. How are check payments handled?
In short, I want to pay taxes due asap and stop any more accruing interest and penalties. What is the best way to do that? Thanks!
Pay the taxes owed from the amended return online using the IRS payment website for Direct Pay making sure that you indicate the tax year being paid and this is from an Amended return - https://www.irs.gov/payments
The penalties and interest will stop after the IRS has received your payment. They will send a bill to you in the mail to pay any penalties and interest. No note is necessary as the payment is recorded in your IRS tax account.
Thank you for the reply! That clears things up. I will get online asap and make payment.
I believe I have reasonable cause for a first time penalty abatement. If I choose to write an IRS penalty abatement request letter, would I wait to write that until after I receive the bill or be pro-active and include that with the return when I mail it in?
Thanks again for the assistance!