Sending Money

Fact: If you make money, you pay taxes.

(Don’t actually send cash)

Most of the population has withholding on a paycheck and never has to actually send a check to the Federal or Local taxing authorities.  If you are in that camp, this note is not for you.

If, however, you are self-employed, have investment earnings, or fall into one of several other categories, you likely find yourself sending money at one (or several) points during the year.  Sending your hard earned dollars to the government is painful.  Save future-you some hassle by sending it in a proper fashion.

Never send cash:

I’m not sure why anyone would; but don’t do it. (Yes, I know my photo shows cash in an envelope.  However, that’s a photo- not an instructional diagram)

Always, always, always double-check your check:

Confirm you have issued to the correct payer and that the amount is written clearly and is accurate.

Use the memo line:

…and be specific. The memo line should indicate the tax you are paying, the period you want it applied to and the account (Tax ID).  So, for a 3rd Quarter 2017 estimate you might indicate the following:  “Q3 2017 US1040 1234”.  Don’t overlook this step, it is vital.

Send appropriate paperwork:

If you are paying an estimate, the check should be attached to a voucher. If you are paying tax due on a notice, a copy of the notice should be utilized

Make a copy:

Even if you utilize a computer program for cutting checks. Make a copy of the check and attach it to a copy of the voucher and/or notice.  Then file it with that year’s taxes.

Check the address:

Different types of taxes have different payment addresses- even within the same taxing authority. Further, folks paying from different states will send the same tax to a different processing center.  Always check the address before issuing your payment.

What about credit cards?

Yes, there are options for paying some taxes by credit card.  However, you will pay a convenience fee and the payment can be more difficult to track.  Still, I have clients who choose to pay their taxes by credit card.  On a personal level, I would STRONGLY caution you against using your bank debit card.

If you enjoyed this article, please consider sharing it!
Icon Icon Icon

Leave Your Response

* Name, Email, Comment are Required