If
you owe federal taxes, the IRS has several ways for you to pay.
Here are six
tips for people who owe taxes:
-
Pay your tax bill. If you get a bill from the IRS, you’ll save money by
paying it as soon as you can. If you can’t pay it in full, you should pay
as much as you can. That will reduce the interest and penalties charged
for late payment. You should think about using a credit card or getting a
loan to pay the amount you owe.
-
Use IRS Direct Pay. The best way to pay your taxes is with the
IRS Direct Pay tool. It’s the safe, easy and free way to pay from your
checking or savings account. The tool walks you through five simple steps
to pay your tax in one online session. Just click on the ‘Pay Your Tax Bill’ icon on the IRS home page.
-
Get a short-term extension
to pay. You may qualify
for extra time to pay your taxes if you can pay in full in 120 days or
less. You can apply online at IRS.gov. If you received a bill from the IRS
you can also call the phone number listed on it. If you don’t have a bill,
call 800-829-1040 for help. There is usually no set-up fee for a
short-term extension.
-
Apply for a monthly payment
plan. If you owe
$50,000 or less and need more time to pay, you can apply for an Online
Payment Agreement on IRS.gov. A
direct debit payment plan is your best option. This plan is the
lower-cost, hassle-free way to pay. The set-up fee is less than other
plans. There are no reminders, no missed payments and no checks to write
and mail. You can also use Form 9465, Installment Agreement Request, to apply. For more
about payment plan
options visit IRS.gov.
-
Consider an Offer in
Compromise. An Offer in
Compromise lets you settle your
tax debt for less than the full amount that you owe. An OIC may be an
option if you can’t pay your tax in full. It may also apply if full
payment will cause a financial hardship. You can use the OIC Pre-Qualifier tool to see if you qualify. It will also tell you what
a reasonable offer might be.
-
Change your withholding or
estimated tax. You may be able
to avoid owing the IRS in the future by having more taxes
withheld from your pay. Do
this by filing a new Form W-4, Employee’s Withholding Allowance Certificate, with
your employer. The IRS Withholding
Calculator on IRS.gov can help
you fill out a new W-4. If you have income that’s not subject to
withholding you may need to make estimated
tax payments. See Form 1040-ES, Estimated Tax for Individuals for more on this topic.
To find
out more see Publication 594, The IRS Collection Process. You can get this booklet on
IRS.gov. You may also call 800-TAX-FORM to get it by mail.
Additional IRS Resources:
IRS YouTube Videos:
IRS Podcasts:
From <https://www.irs.gov/uac/newsroom/six-tips-for-people-who-owe-taxes
