Your options if you owe money
Original Post Feb 13, 2019
When things don't go the way we want or expect, sometimes we want to just go back to bed and hide under the covers.
With what has been happening as more people are filing their returns and finding that they have no refunds or perhaps (oh no!), a balance due, there is the thought of just doing that. But if your return was prepared properly, and the taxes are correct, avoiding it will not make things any better.
First, remember that the money is not actually due until April 15. So as of the date I am writing this (February 13), you still have time to try and put the money together.
Second, IRS will accept credit card payments. But because by law IRS is not allowed to pay credit card fees, YOU will have to pay those fees (adding insult to injury). And be careful ... your credit card company might charge it as a cash advance so it will be a higher rate. Or ...
Second, continued ... many credit cards give you an "opportunity" to get an "interest free"
cash advance that is good for anywhere from 6-15 months. You pay a transaction fee of 3-5% of the amount, depending on the bank, and then have that amount of time to pay it down without additional interest. CAUTION!!! Watch the due date for the advance and if regular monthly payments are required, make them to avoid being hit with interest from the beginning.
Third, IRS has an "automatic" installment program if you owe less than $50k. There is an "application" fee that is lower if you have the funds withdrawn from your checking account each month when the installment payment is due. You can stretch the balance out to a maximum of 72 months. Interest is charged but at a VERY low rate. AND ... this is NOT reported on your credit files.
DON'T ask for an extension of time! The extension is ONLY to file the return. The payment is still due on the 15th.
Have more questions... want to have your return prepared ... need to have your withholding for 2019 calculated... please let me know.