Direct payment of taxes to the Internal Revenue Service (IRS) needs to be kept in order to stay in good standing with U.S. tax laws. The IRS offers several ways to make payments, depending on your needs, from electronic funds to old-fashioned checks. This article outlines the ways to pay, how it is processed, and how long one’s taxes are paid.
Ways of paying taxes directly to the IRS
The IRS provides a variety of types of payments from cash to online service payments. The most widely used ones are as follows:
1. IRS Direct Pay
IRS Direct Pay is convenient and free, and the taxpayer pays directly from his or her checking or savings account.
- How it works: Visit the IRS Direct Pay website, verify yourself with information from a previous year’s tax return, and pay.
- Key features
- Scheduling is possible 365 days in advance.
- Payment can be modified or cancelled two working days prior to the date it is to take place.
- Same-day payment is available.
- Time to process: Payment will clear in two working days.
2. Electronic Federal Tax Payment System (EFTPS)
The EFTPS is an Internet-based system managed by the United States Department of the Treasury. It is convenient for individuals and organizations.
- How it works: Sign up on the EFTPS website, which will take a maximum of five business days. After signing up, you can make advance payments on the Web or over the phone.
- Key features:
- Making payments in advance for a period of one year.
- 16 months history of payments.
- 24/7 access to schedule and make payments.
- Processing time: Payments are received and processed within one business day after submitting it.
3. Credit or debit card
Taxpayers can pay by debit or credit card through the services of IRS-approved payment processing agents such as Pay1040 or ACI Payments.
- How it works: Visit the processor’s website, enter your card information, and pay.
- Key features:
- Convenient online or phone payment.
- Major credit cards and electronic payments such as PayPal and Venmo accepted.
- Processing time: Payments will typically be processed immediately but take two business days to verify.
- Fees: Debit card fees range from $2.10 to $2.15 per transaction, while credit card fees are a percentage of the payment (1.75%–1.85%).
4. Cash payments
Those who do not have a bank account can also make cash payments at merchants such as CVS Pharmacy, Walgreens, and Dollar General.
- How it works: Set up a payment through the IRS “Pay with Cash at a Retail Partner” website. You’ll receive a barcode that can be scanned at the retail location.
- Key features:
- Accessible in all states.
- No daily limit on the number of payments.
- Processing time: Payments are processed within one business day after completion.
- Fees: A $1.50 fee applies per transaction.
5. Checks or money orders
Regularly scheduled checks or regular money orders can also be sent directly to the IRS.
- How it works: Send pay checks that are preprinted with “U.S. Treasury” and your address, Social Security number (or Employer Identification Number), year of tax, and type of form in memo line.
- Processing time: Postal service mailing time and IRS processing will take several weeks for mailed payments.
How long does it take for taxes to be paid?
How rapidly your tax payment is processed depends on the method:
- IRS Direct Pay: In as few as two business days.
- EFTPS: Typically one business day after filing.
- Credit/Debit Card Payments: Instant processing but sometimes up to two business days to verify.
- Cash Payments: Typically processed one business day after transaction finalization.
- Checks/Money Orders: Weeks due to mailing and manual processing.
Tips for keeping tax payments on time
Avoid late payment interest or penalties:
- Use electronic options such as Direct Pay or EFTPS to process rapidly.
- Pay in advance if using slower options such as checks or money orders.
- Verify payment details ahead of time when submitting to identify errors that will not slow up processing.
The IRS is giving the taxpayers numerous easy-to-use payment mediums to make direct payment for taxes, from online forms to traditional payment. Acceptance periods vary from real-time if payment is made through credit/debit card to weeks if payment is sent through checks in the mail. With the liberty of choosing the proper payment medium and preparation, taxpayers are at liberty to pay on time without hassle and without extra charges.
Read more: How do I file a final tax return for a deceased person?
Read more: What income is free from federal taxes?
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