I can only speak for myself, but when given the choice of dental surgery or filing taxes, I would probably opt for the former. Every year when the tax filing deadline approaches, I fill with a sense of dread. Even when I receive a refund, I still hate doing the paperwork. However, this year a friend of mine had even more reason for her feelings of loathing towards the IRS. While she did her due diligence, she received notification that she owed money. She was about to find out what happens when the IRS rejects your tax payment.
The IRS Rejection Letter
This week, a friend of mine came across an unusual tax problem. Like a good citizen, she filed her taxes before the deadline (however, in the eleventh hour). Using Turbo Tax, she e-filed her return and indicated that she wanted to make a payment electronically. But, she only received confirmation that her return had been accepted, not that the payment had been taken.
Understanding that it takes time for the IRS to process these things, she waited for the money to be withdrawn from her account. Two weeks later, the money remained there untouched. Wondering if something went wrong, a slight panic was beginning to set in. Finally, she received notice from the IRS telling her they could not locate her account. Although she had used the same account for previous payments, the IRS could not accept her tax payment.
Tracking Down the IRS Rejection
The fact that the IRS rejected her payment was the most puzzling thing. The account had sufficient funds and had been used for other purchases just that week. So, there should have been no issues making a tax payment. However, the letter informed my friend of her failure to pay, listing “No Account/Unable to Locate Account” as the reason. This seemed vague and unclear, so we called the helpline at the number they provided to figure out what went wrong.
We didn’t have to wait long to speak with an agent who cheerfully identified herself and answered all our questions. She sounded as if she had encountered this problem before and helped shed some light on the situation. Apparently, a number or character from the e-file forms didn’t match the information on the account exactly. When it is unable to verify personal information through the automated system, the IRS rejects your tax payment.
How to Pay the IRS after It Rejects Your Payment
One positive thing I can say about the IRS is that they make it very easy for you to pay them. They provide several ways to contact them online, by phone, or by mail. The letters from the state and federal government informing my friend of failure to pay also came with detailed instructions. Each one outlined where to make payments, step-by-step.
Making Payments Online
There are two separate websites where you can pay your outstanding debt to the IRS. The first is directly through their website at irs.gov/payments. From there you can choose to pay with debit, credit, or direct pay from your bank account. However, be warned that you must pay a convenience fee for both credit and debit payments. There are no fees for the direct pay option, but you will need your account and routing number to complete the transaction.
The second option is through the Treasury Department’s Electronic Federal Tax Payment System (EFTPS) site. Once you have enrolled and received confirmation, you can pay all taxes due using this system. They will also verify accounts or update the bank information for the account you want to use. Enrollment is free, and you can terminate it after you finish using it.
Making Payments by phone
The next option you have when the IRS rejects your payment is by phone. Although the information wasn’t included with the federal notification, the state revenue service provided a dedicated line for Taxpayer’s Assistance at (800) 742-7474. I followed the automated prompts which directed me to the specified lines to pay federal income, state income, and property taxes. As with online payments, credit and debit payments will require a convenience fee. However, in just a few minutes you can get your taxes paid and be free of the burden.
The last option is best for those who prefer the tried-and-true methods of paying your taxes. You can send a check or money order addressed to ‘United States Treasury’ to the following address:
Internal Revenue Service PO Box 1211 Charlotte, NC 28201-1211
If you decide to mail your payment, be sure to include your tax ID (either your Employer Identification Number or Social Security Number), the tax form number, and the time period your payment is for.
Further Assistance When the IRS Rejects Your Payment
There is no shortage in the ways available to pay your taxes. Not only is it secure, but also fairly efficient. That is if all you need to do is make a payment. If you are seeking a refund or need to speak with an agent, you will need to call e-file Payment Services at 1-888-353-4537 to make payment plans or discuss specific problems. I didn’t have to wait long to speak to a representative. However, it was only a general helpline. So, the agent gave me yet another number to call.
To resolve the problem of the undeserved returned payment fee, my friend will have to dispute the charge. Although you might not think it worth your time to dispute a $20, you can pursue it on principle. If you choose to go this route, there is a dedicated line for IRS Customer Support at (800) 829-1040. If you call between 7 a.m. and 7 p.m. you can submit your claim and attempt to refund the penalty fees.
Even though technology has made filing taxes much simpler and less daunting, it still makes mistakes. However, if you encounter a similar situation, you can rest assured that the IRS has people on hand to help you pay your taxes.