Credit as Payment Options Offered by IRS

CPAs preparing individual tax returns should advise their clients that the IRS will now provide more options for payment with credit cards and direct debit of bank accounts for the 2000 filing season.

The new options expand from the IRS' previously approved rules that only applied to balances due for 1998 taxes.

The expanded options will allow credit card payments for:

  • any balances owed on 1999 returns,
  • protected balances paid for 1999 where returns will be filed later under any extention option, and
  • estimated payments for year 2000 taxes.

As in the past, some penalties still apply if credit cards or debit arrangements are used. Credit cards include Discover, American Express and MasterCard. Visa is not an option because Visa requires merchants also to charge a fee. By law, the IRS cannot charge fees.

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