It’s a new year, and while we may have a variety of hopes for the coming year — a cessation or at least a lessening of disease and war might top some lists — one of the things that you can be sure you’ll have to deal with are your annual taxes. (The usual quote about death and taxes goes here.)
While tax day traditionally has been set for April 15th, this year, we have until Tuesday, April 18th. (April 15th is a Saturday, while the following Monday is Emancipation Day, which is an official holiday in Washington, DC.)
One thing to be aware of is that, while there were a number of changes that were in force during the pandemic, the IRS is slowly pulling back on them. They are listed on this page; in short, these changes include: no stimulus payments happened in 2022 (so you can’t claim credit for any you didn’t get); tax credits such as the Child Tax Credit are going back to 2019 levels; and if you don’t itemize and take the standard deduction, you won’t be able to deduct charitable contributions. On the positive side of the ledger, more people may be eligible for a premium tax credit, and the Inflation Reduction Act of 2022 may qualify you for a Clean Vehicle Credit.
Confused yet? Try not to worry — we’re going to list some resources that are available so that you can prepare your taxes and pay them online. As always, it might not be a bad idea to start working on those taxes as soon as possible to avoid any last-minute panic (especially since, according to the IRS site, there are still lingering delays due to the pandemic). And whether you’re a full-time worker dealing with a single 1040 or a freelancer / gig worker getting a series of 1099s, the fastest way to pay the piper these days is to do it online.
The IRS offers a series of directions on its website to help US citizens figure out their taxes, report those taxes, and send in payments (or ask for refunds) using its e-file online method. Here’s a rundown of what’s available and where you can find it.
First, you can have the IRS pull the funds directly from your bank account via Direct Pay for paying your annual taxes (using 1040 forms), your estimated taxes, or a number of other types of taxes; they are listed here. Direct Pay is for paying personal taxes. If you are paying business taxes, you can do that through the Electronic Federal Tax Payment System (EFTPS). Be aware that, according to the IRS, it can take up to five business days to process a new EFTPS enrollment.
If you use a credit card, it could cost you up to another 1.98 percent of your payment amount
You can also pay via a credit or debit card or a digital wallet such as PayPal or Click to Pay; however, there is a fee involved (since the IRS isn’t going to absorb what your credit card company is charging for the service). If you’re paying by debit card, it will cost $2.20 or $2.50, depending on the service you use. If you use a credit card, it could cost you up to another 1.98 percent of your payment amount — so if you can, Direct Pay is definitely the way to go.
If you owe taxes but simply don’t have the available funds to pay them, you can arrange for a payment plan. If you can manage to pay the full amount within 180 days, you can establish a short-term payment plan in which there is no setup fee (although you will have to pay penalties and interest on the owed amount). Otherwise, you could qualify for a monthly payment plan for which you apply either online, by phone, or by mail. It will cost an additional $31 setup fee besides penalties and interest, although it’s possible to get a waiver of that fee if you qualify.
One of the ways the IRS tries to convince you to file online is to assure you that you will get your refund faster — in less than 21 days, in most cases, although there are exceptions. (If you file via paper, it could take six months or more to process.) Once you’ve filed, you can check the status of your refund online 24 hours after you’ve filed. You can also download the official IRS2Go mobile app, which allows you to check the status of your refund, pay your taxes, and get other information.
If you can’t do your taxes by the due date because of a family emergency, job pressures, or because you simply put it off for too long, you can file for an extension. We’ve got a separate article telling you how to do that right here.