Paying Your Taxes

If your tax return shows that your prepaid taxes are less than the taxes you actually owe, you'll have to send some money in with your tax forms. If you owe more than $1,000 and more than 10 percent of the tax shown on your return, you may also owe a penalty. You can, if you wish, send in the amount you owe without the penalties - the IRS will compute the penalties and interest you owe and send you a bill later.

We generally recommend that you let the IRS compute your penalty, since the computation is extremely complicated and time consuming.

However, the standard IRS computation assumes that you received your income evenly over the year. If, in fact, you received most of your income in one or two quarters, you will have to file IRS Form 2210 in order to show that.

Make your check payable to the United States Treasury, and be sure to write the year and the tax form (for example, "2014 Form 1040"), and your Social Security number on the check.

Work Smart If you are filing jointly, write the name and Social Security number of the spouse whose name appears first on the front of your tax form. Otherwise the IRS might not apply the payment to the correct account.

If you send in a check, you must also complete Form 1040-V, Payment Voucher, and include it with your tax return. The IRS requests that you don't staple the check to your return, but simply enclose it in your envelope.

Planning Tools You can download Form 1040-V to aid in your financial planning.

Direct transfer. To pay by direct transfer from your bank account, call 1-800-555-4477. You will need to provide your bank routing number and your account number.

Credit card payments. The IRS will also allow you to pay your taxes by credit or debit card, but you'll have to pay an additional fee to do it. We generally do not advise you to take advantage of this option. Taxes are painful enough, without having to pay credit card fees and interest on top of them!

If you do want to pay by credit card, call 1-888-2PAY-TAX and follow the instructions. You will be told what the "convenience fee" charged by the credit card processor is, and you will have the option to continue or to cancel the call. You can also find out what the fee will be on the Internet, at www.8882paytax.com.

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