IRS Direct Pay can help taxpayers avoid an estimated tax penalty.
If any of your clients make two thirds of their gross income from farming or fishing, they may need to file a Form 1040 and pay tax due on Monday. Affected taxpayers who miss the deadline could owe an estimated tax penalty.
The IRS recently issued a press release reminding farmers and fishermen about the March 2 filing and payment deadline for those who do not make quarterly estimated payments throughout the year. (The deadline for farmers and fishermen who make estimated payments is April 15.)
To simplify the process, the IRS says that farmers and fishermen who need to meet next week’s deadline can make a payment with IRS Direct Pay: “Anyone can use this free online service to quickly make federal individual income tax payments or quarterly estimated tax payments directly from their checking or saving account.” The agency also stressed that there are no signup fees or pre-registration requirements, making it even simpler.
While taxpayers can use IRS Direct Pay to settle their individual income tax bill, it will not accept payments for “federal highway use tax, payroll taxes, or other business taxes.” To make those payments, the IRS suggests using the free Electronic Federal Tax Payment System.
For more information about taxes for farmers and fishermen, the IRS provided two links: Tax Topic 416 and Publication 5034.
Source: IR-2020-37
Kelly Cutshall, CPA, PLLC
