I know you’ve all heard it – you have until April 18th to file you taxes this year. Great news if you are not having trouble rounding up the funds to pay the tax bill. But what about those who do owe and cannot pay? What are the options? Here are three choices offered up by the IRS.
Additional Time to Pay Based on your circumstances, you may be granted a short additional time to pay your tax in full. A brief additional amount of time to pay can be requested through the Online Payment Agreement application at http:www.IRS.gov or by calling 800-829-1040. Taxpayers who request and are granted an additional 60 to 120 days to pay the tax in full generally will pay less in penalties and interest than if the debt were repaid through an installment agreement over a greater period of time.
Installment Agreement You can apply for an IRS installment agreement using their Web-based Online Payment Agreement (OPA) application on IRS.gov.
For each of these options you will receive a written notification telling you whether your terms for an installment agreement have been accepted or if they need to be modified.
Pay by Credit Card or Debit Card
As Benjamin Franklin once said, “…in this world nothing can be said to be certain, except death and taxes.” The penalties for not filing and paying taxes on time can be very steep. The IRS adds penalty fees and interest on to late taxes and can take steps to seize bank accounts, property, and potentially send someone to jail. Be proactive and find out what your options are for dealing with tax debts.