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Post Date:  5/29/2014
Last Updated:  5/29/2014

Summary
Cross References
- www.irs.gov

The IRS has launched a new way for taxpayers to pay their tax liability online. The IRS Direct Pay website allows taxpayers to pay their Form 1040 tax bill or make estimated tax payments directly from their checking or savings account at no cost. The taxpayer receives instant confirmation that a tax payment has been submitted. Bank account information is not retained in the IRS systems after payments are made.

The taxpayer must have a valid Social Security Number to use the application. The application cannot accommodate Individual Taxpayer Identification Numbers (ITINs).

Paying taxes online is done in five steps:
- Provide tax information.
- Verify the taxpayer’s identity.
- Enter payment information.
- Review and electronically sign the transaction.
- Print or record the online confirmation number.

Prior year tax returns. The system allows for payments towards a 1040 tax return for the last 20 years. There are two exceptions—estimated tax payments and payments with requests for extension of time to file can be made for the current tax year only.

Tax payments for returns other than Form 1040. At the current time, only 1040 return series payments can be made through IRS Direct Pay. Additional payment types will likely be added to the application in a future release.

Verifying identity. A taxpayer’s identity is verified by using one of the taxpayer’s prior year processed tax returns. The taxpayer can choose one of the last five years for identity verification. Information from that return is entered by the taxpayer during step two and the program cross checks that information with the information on the previously filed tax return. If the information matches, the identity is verified. This verifying step must be done each time the taxpayer uses the system to make a payment.

Payment processing. Once a confirmation number is received, the taxpayer should expect it to take two business days to process the payment. Payments submitted after 8 p.m. Eastern time are processed the next business day.

Taxpayers can also schedule a payment for up to 30 business days in advance. At present, there is no provision to set up recurring payments using IRS Direct Pay. Taxpayers making installment agreements should consider using the Online Payment Agreement application. See www.irs.gov/Individuals/Online-Payment-Agreement-Application for details.

If there are insufficient funds in the account at the time the payment is processed, the taxpayer will receive a payment return notice in the mail notifying the taxpayer to resubmit the payment.

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