I have money; how do I get the IRS to take it?

April 12, 2019 8:50 AM

2018 was my first year as a consultant with an EIN. I filed an extension on my taxes but need to make a payment by April 15 to avoid penalties. I need to find a way to get the IRS to take my money, and literally every route leads me to a brick wall. Help! More details inside.

I have an appointment with an accountant for May 1, who has filed an extension for me. I literally had no idea that quarterlies were mandatory, not optional (whoops!) so I need to hand the IRS money for last year's taxes by April 15 to avoid a penalty.

I don't know what the penalty is, but I'm imagining that if I give them money after April 15 it will be something like double what I would owe if I pay by April 15. I can cover that but I'd much rather pay them beforehand and save thousands of dollars in penalties. If I'm wildly overestimating the penalty and it will be something like 10% of what I currently owe rather than 100%-1000%, I would love to know that because in that case I'll just hold out til May 1. I've looked on the IRS website but nothing about the late payment penalties makes sense to me (maybe because I'm too stressed to be able to process it at this point).

I really, really need to go through an accountant because I have an issue with what state I am technically a resident of. My sole proprietorship is in one state, my drivers license is in another, and I've spent most of the past 16 months out of the country.

The EFTPS website says "if you started your business less than a year ago, we already have a PIN for you, call us." I called them and they don't have a PIN for me. I've filled out the paperwork. However, that PIN will not come through until after April 15.

The IRS will send you vouchers to pay...if you've previously paid electronically through EFTPS. Which I haven't, because I don't have a PIN.

I also can't make an EFTPS payment by phone because you have to have the PIN to do so.

I could make an estimated tax payment through my SSN, but I'm worried that will screw things up for me with regards to taxes, my business, etcetera.

I did some work with tax software to figure out what my estimated payment should be. At this point I feel like my only option to avoid a penalty will be to file my taxes electronically through that software and then get the accountant to amend my taxes.

I have messaged my accountant for advice but obviously he is completely under the gun right now and I don't expect an answer. Therefore I am hoping that the fine people of Metafilter can help.

tl;dr: How do I get the IRS to take my money in a way that is associated with my EIN when I have no PIN and no vouchers?

posted by rednikki to Law & Government (12 answers total)

Best answer: I did some work with tax software to figure out what my estimated payment should be.

Download a blank voucher and fill it out and mail it with a check.
posted by JimN2TAW at 9:05 AM on April 12, 2019 [3 favorites]

Best answer: This is general advice, and my direct experience is only with NYS Department of Tax and Finance, not with the IRS, but I've heard the same thing about the IRS.

The human beings who work there are decent and competent, and they're in the business of straightening things out for people who are trying to comply with the law but are confused about something or have a holdup. Obviously, this is a terrible weekend to be trying to get a person on the phone at the IRS, but I would sit on hold on any help-line you can find, and even if it takes a couple of hours waiting, try to get an IRS person to talk to. I would bet that they can figure your situation out.
posted by LizardBreath at 9:10 AM on April 12, 2019 [1 favorite]

Best answer: If I'm wildly overestimating the penalty and it will be something like 10% of what I currently owe rather than 100%-1000%

IRS Form 2210 defines the underpayment penalty. tldr - it's quite low - 0.5% of the amount you owe per month. Further, the IRS is generally quite forgiving of even this penalty. This isn't something to worry about. Call the IRS and see if they can help you out here - they are quite helpful, in my experience, even more so than many accountants. First, though, take a breath, and recognize that this is something many other people (including myself) have accidentally done, and the IRS recognizes that, and the consequences aren't even that high anyway.
posted by saeculorum at 9:14 AM on April 12, 2019 [4 favorites]

Best answer: I don't know what the penalty is, but I'm imagining that if I give them money after April 15 it will be something like double what I would owe if I pay by April 15.

I pay quarterly and regularly screw up what I owe (because my earnings are all over the map) and some years I pay penalties. My taxes are in the low four figures usually and my penalties are often less than $20. They accrue something like monthly so if you are paying them on or around May 1st, when your appointment is, they will be very minimal. If you want to put your mind at rest, get in the hold queue for the IRS but know that you are probably fine.
posted by jessamyn at 9:18 AM on April 12, 2019

Best answer: Do you pay your business taxes via a Schedule C on your own return or is it a separate corporation. I have an EIN for my schedule C business but I pay my estimated taxes with reference to my SSN. So, it is simple in that case. Also, when paying with your social, you can just download a blank form, fill it out and mail it in as long as it gets postmarked on time.
posted by metahawk at 9:18 AM on April 12, 2019

I'm not a tax expert, but, as a sole proprietor, your income should flow through to your personal income, so you ought to be able to use the voucher included with Form 1040-ES.

The penalty involved will be quite small if you pay a month or two late on your quarterly payment unless the amount involved is quite large, so if you would like greater comfort than you can get from Internet randos, it won't kill you to wait til you can see the CPA.

Either way, and I'm saying this with kindness, please take the fact that you managed to be completely oblivious to a major financial obligation as a lesson that you need to go get some proper business advice and stop flying by the seat of your pants. Next time, through lack of knowledge you might screw up something less easy to fix.
posted by praemunire at 9:26 AM on April 12, 2019 [2 favorites]

Best answer: The IRS makes it super easy to pay them money. You can go to their website: www.irs.gov/payments. Choose how you want to pay them. You'll input your social security number - they don't even need the EIN if I recall correctly.

You may need a copy of last year's return for some identity verifications. You'll apply the payment to your 2018 taxes.

Quick and easy. This is how I pay my quarterlies too - done in about 5 minutes.

AND don't forget that the first quarterly payment of your 2019 taxes is ALSO due on April 15! Go through the process a 2nd time and apply a payment toward 2019.

(This is all assuming your business is a sole proprietorship. I don't know how to pay business taxes to the IRS. As a sole proprietor, the IRS doesn't really care about whether you're paying as the business or as redniki. The EIN you have is just a way to avoid giving out your SSN.)
posted by hydra77 at 9:47 AM on April 12, 2019 [1 favorite]

Best answer: Yes, mail them a check and put your EIN on it. Use your SSN if your EIN is not yet assigned. Note the time period it should be applied to.

The penalties are not that horrific. They can impose a fine for lateness, plus some interest. Just keep copies of everything.
posted by theora55 at 11:57 AM on April 12, 2019

Best answer: Your company doesn't owe any taxes, unless you had payroll or something that you didn't correctly make deposits for. For income taxes, at least, you're the one who owes them, as an individual.

If I'm wildly overestimating the penalty and it will be something like 10% of what I currently owe rather than 100%-1000%, I would love to know that because in that case I'll just hold out til May 1.

The IRS is way less evil than you think they are. You're already late by their standards on most of it, because you were supposed to make the first part of the payment a year ago, but as mentioned, the actual late fees are quite low. The big penalties are for way bigger screwups than sole props who didn't know they were going to need to make quarterly payments. I had clients where I successfully got even those waived, but that was years ago now; I won't speak to whether that's viable for you here, just that it's indicative that they really just want to make sure you know to do better in future, not to punish you for being a bit overwhelmed at the beginning.

I'd just use the direct pay website, but I don't think it'll be a serious hardship if you just wait.
posted by Sequence at 12:51 PM on April 12, 2019 [1 favorite]

Best answer: unlike nearly every rapacious commercial entity (eg credit cards, the mafia) you might owe money to, the IRS's overdue rate is really low. Like ~6% a year low. I would not sweat this too, too much.
posted by zippy at 2:55 PM on April 12, 2019

Best answer: Yes, mail them a check and put your EIN on it.

No, do not use your EIN. Your taxes are your taxes, not your business' (unless you have a C-corp, which would be unusual). That means your taxes are identified by your SSN, the same as on your Form 1040.
posted by JackFlash at 3:39 PM on April 12, 2019

Best answer: Not necessarily good advice, but I always just paid when I filed, andpaid the penalty for not doing the quarterly payments, because the $100 or so it usually ended up being for me was worth it not to have to worry about it more than once a year.
posted by Nothing at 7:30 AM on April 14, 2019