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Tax season is nearing, but are you ready?
With tax season coming up, many people are scrambling to find out ways that they can pay their taxes. It will also be a first for many people because they’ve recently graduated from high school and college.
If you are unsure as to how to pay taxes, fret not. Technology has allowed us to make payments with various methods. The IRS happens to accept several of those payments methods!
You can find out the best way to pay taxes with this guide. Read on to learn about the IRS and their accepted payment methods.
What Is the IRS?
The IRS is the Internal Revenue Service. They are responsible for collecting taxes and enforcing the laws surrounding them.
Every year, people that work and meet the income requirements are supposed to file tax returns. Doing so will also allow them to collect on a portion of the taxes that they’ve paid.
People often worry about their taxes because they aren’t sure if they have to. Some of those that don’t pay their taxes wonder what the IRS can do to them because they’re afraid of getting arrested.
You won’t necessarily go to jail if you don’t pay your taxes, but it’s important to pay them to stay on good terms with the government. One of the reasons they accept several payment methods is to allow a wider range of people to comply.
Pay Online with Direct Pay
“Can I pay my taxes online?” This is a question that many people have because it seems like it’d be a viable way to pay taxes. Yes, you can pay online. The IRS provides a service that allows you to do this at ease.
IRS Direct Pay is a payment method that allows you to pay them directly from your bank account.
Direct Pay is a good option for those that would like to pay payroll taxes online because you can schedule payments and send up to $10 million without a processing fee.
The service is a secure platform that also allows users to track their payment history from the past 24 months and provides email updates.
Pay Online with Debit or Credit Card
Paying taxes online with a credit card and a debit card is one of the most popular methods that people use. This allows one to enter their card details and send a payment without having to enter bank information.
One of the benefits of using a credit card is that you can pay your taxes upfront and pay off the money over time. Not only will this get your taxes taken care of, but it will also allow you to build credit at ease.
The biggest downside to using one of your cards is that there are fees that are applied. There are also only 3 payment processors that can be used, so there isn’t much to choose from.
Using a debit or credit card is great if you’d like to draw up an instant receipt and potentially build credit, just be cautious if you know you can’t afford to pay the credit.
Send a Check or Money Order in the Mail
Checks and money orders are some of the old-fashioned ways of sending money. This method has been used for a long time because it allows the IRS to receive money directly from a person’s account.
Money orders are a safer way to send money because they require you to pay a distributor in advance. Paying upfront prevents check bounces, which occur when you don’t have enough money in your account so the check isn’t processed.
They were also used because the internet wasn’t as advanced and secure as it is today. While there are now more ways to pay, checks and money orders are still viable options.
If you’re wondering who to make check out to for federal taxes, the checks and money orders should be payable to the United States Treasury. You should include the form that you’re filing along with the check or money order.
The tax form will have the address that you should send your payment to.
Pay with Cash in Person
If you’d prefer to avoid all the technology in general, you can opt to pay with cash. This is the most secure way to pay the IRS because they will receive your money directly from you.
This can be done by going to a local IRS office with your cash in hand. You should set up an appointment ahead of time because these offices often get busy.
If you don’t set up an appointment, you could be turned away or end up sitting at the office for hours.
You can also pay with cash at participating retail stores. This will allow you to avoid setting an appointment with the IRS, as you can walk into the store and pay on the spot.
While paying with cash will avoid any issues with technology or the transmission of your electronic funds, you should be cautious when carrying large amounts of money.
Because of this, retail stores will only accept up to $1000 for each payment. This will prevent you from having a reason to carry a lot of cash.
Choose the Best Way to Pay Taxes for You
The IRS accepts a variety of payment methods because they’d like their services to be accessible to a plethora of people. Having several forms of payment gives people options and alternatives should their previous method fail.
All of these payment methods are reliable and secure, so it’s up to you to decide which one is the best way to pay taxes. Since tax season is coming up, look more into the options to prepare yourself.
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