Can I E-File My Return If I Owe the IRS Money?
E-filing is a convenient way to pay taxes, but what if you owe the IRS money from a past return, or what if you know in advance that you will owe the IRS for the return you are about to file? The short answer is: You can e-file your tax return if you owe the IRS money, but there are a few important things to know.
Electronic Funds Withdrawal
When e-filing, you can authorize the IRS to make an electronic funds withdrawal directly from your bank account, both for back taxes owed and for any money you may owe for your return from this year. In order to choose this option, you will need to provide your checking or savings account number and your routing number. If you don't know how to find these numbers, don't worry – there are instructions and diagrams that will help you once you reach this step in your e-filing. You are able to specify when the IRS may withdraw the money from your account provided that you are paying for that year's return. You must specify a date that is on or before the day taxes are due (typically April 15 of each year).
It is also possible to create a direct deposit from the IRS and/or any state – to the bank you have supplied an account and routing number for. In this way your money will go directly from the IRS or State Taxing Agency into your account if you are owed a refund.
Note that some credit unions will not allow electronic funds withdrawal from their accounts, so prior to e-filing, please make sure that your financial institution allows you to debit money from your account.
Electronic funds withdrawal is available for Form 1040 for the current year, as well as for Form 1040-ES, Form 2350, and Form 4868. Taxpayers filing Form 1040-ES can make up to four estimated tax payments in one filing.
Other ways in which I can pay my taxes?
The United States treasury now offers a variety of payment options for taxpayers. If you would like to mail a physical check, money order, or cashier's check this can be done with an accompanying 1040-V (1040 payment voucher). The mailing address for tax payments changes based on where in the country you are located. Please review this page before sending. When mailing a payment, always make sure to include the taxpayer's name, address, phone number, social security number and tax year the payment is for.
You may also opt to send an electronic payment along with your tax return. The US Treasury also now accepts credit and debit card payments which are processed through third-party authorized providers. For a list of these providers please visit:
Please note: credit/debit card processors charge a fee to the taxpayer for accepting payment in this manner. These fees typically start at $2.79 and may be as much as 2.35 percent of the payment.
Finally, a payment can also be delivered in person to any authorized IRS field office.
Can I pay the tax preparation fees with my refund?
Besides offering software at 50% less than the cost of our competitors, we also provide users with the ability to pay for their tax preparation in a variety of different ways. We accept all major credit and debit cards. If the filer is expecting a refund they can also opt to pay their fees using their anticipated refund. This is a great solution for those who either don't have access to a credit card or prefer not to pay up front for the software.
When taxpayers select to pay with their refund, the refund goes to a third-party financial institution (not to E-file.com). The financial institution we partner with to provide this is Santa Barbara TPG. TPG acts similar to an escrow service, when they receive the taxpayer's refund, they pay us for the software and deposit the balance to the taxpayer. TPG does charge a service fee to provide this service, there is no fee for paying with a debit or credit card.
When a taxpayer selects to pay with their refund TPG setups up a direct deposit account for their refund. Once the refund is received from either the IRS or their state, TPG will withhold the cost of the tax preparation software and any applicable fees, then deposit the refund directly into the taxpayer's bank account.
What if the IRS does not process my refund?
If the IRS or taxpayer's state does not issue the anticipated tax refund within a reasonable time frame and TPG cannot reimburse the software fees to E-file.com, the taxpayer's software and preparation fees are still due. As such, we reserve the right to recover this. In this event, we will notify the taxpayer via email that their return has not been funded, these emails will contain a link with instructions on how to provide us with payment information. Taxpayers will be provided approximately four weeks from initial email to provide payment. If no payment information is provided, we will proceed with electronically withdrawing the payment from the taxpayer's bank account.