In March, the U.S. Department of the Treasury was directed to begin phasing out the acceptance and disbursement of paper checks. This phase-out is set to occur by September 30, 2025, and the purpose is to enhance security, reduce fraud, and improve government efficiency.
How will this affect you?
If you are due a tax refund, you will need to have that refund directly deposited into your bank account, as the IRS will cease issuing paper checks.
If you owe federal taxes when you file, or if estimated tax payments or other federal payments are due, you have the following options:
- Recommended - Create an ID.me account to be able to pay any balance due, extension, and estimated tax payments, and more.
- Recommended - Have balance due and estimated tax payments set-up to be electronically drafted from your bank account on the applicable due date. This is done by providing your accountant with your banking information. Estimates should only be scheduled for auto payment if not expected to change during the year as cancellation requires IRS intervention.
- Pay online directly from your bank account at irs.gov/payments without an ID.me account.
Our preference is that you utilize direct deposit/direct draft AND create an ID.me account with the IRS. By doing so, you can make secure payments, access transcripts of your prior tax returns, see payment history, receive tax notices from the IRS, receive your identity protection PINs if needed, and view other tax records. Having an ID.me account ensures you have secure access to IRS services, tax records, and payment tracking, which will be helpful to us if any tax issues arise.
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- To create an ID.me account and pay, navigate your browser to https://www.irs.gov/payments/online-account-for-individuals, click on the “Sign in or create account” button, Create an Account, follow the prompts to create your account. You will need to have your mobile phone with a camera, a copy of your driver’s license, a valid e-mail address, and your social security number to complete the process. Only one ID.me account is needed to access your individual and business accounts.
- To pay by direct draft at filing, provide your tax accountant with your bank name, routing number, and account number located at the bottom of a check. Instructions regarding the timing of the drafts will be noted in a letter to you when you receive your tax return documents.
- To pay your individual or business tax online without an ID.me account, navigate your browser to https://www.irs.gov/payments/direct-pay-with-bank-account, click the link for the tax you are paying, click on the “Make a payment” button, select your reason for payment (balance due, extension or estimated tax payment), apply payment to type of income tax, select tax return year. Then follow the prompts to enter your personal or business information, payment amount, and bank account information. You may also pay online by credit card, but additional fees will be charged.
For more information about the above article or other individual tax services, contact Louis Hawkins, CPA at (334) 887-7022 or by leaving us a message below.
