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Using direct debit to pay your owed income taxes

Updated: 5/28/2013
Article ID: GEN12119

With direct debit (not to be confused with direct deposit), the IRS or state tax authority automatically withdraws the full owed tax amount from your bank account.

Partial payment through direct debit is not possible, and direct debit is only offered as a payment option on e-filed returns.

 

Important: Please double check your bank information before you e-file. TurboTax cannot determine if the bank information you enter is accurate or that your account has adequate funds. We do not contact your bank on your behalf to make sure your payment to the tax agency will process correctly.

If a direct debit failure happens, the tax revenue agency discovers it and notifies the taxpayer directly. The tax agency does not notify TurboTax.

We recommend that you actively monitor your bank account and if your account is not debited within a reasonable time, contact the tax agency by telephone to inquire about the transaction.

 
 

 

When does my payment get withdrawn?

If you specify a direct debit date that falls on or before the mid-April filing deadline, the IRS debits your account within 1 – 4 days after your e-filed return is accepted. The actual debit date may be after the date you specified. In these cases, you won't be charged late payment penalties or interest, as long as you filed before the deadline. More info

On the other hand, if you e-file after the mid-April filing deadline, your direct debit is authorized on the date you e-filed.

Please note that it can take your bank up to five days to complete the transaction and update your account information. We suggest that you wait five days after your e-file is accepted before contacting your bank, if you are concerned that the money hasn't been debited yet.

To verify the date that funds will be withdrawn from your account, confirm that funds have been transferred, or cancel the transaction up to 48 hours before the date you designated the funds to be debited, call the IRS at 1 (888) 353-4537.

Note: Once your e-filed return has been accepted, it's no longer possible to change the bank account that will be debited.

The IRS has not yet withdrawn my payment. Should I worry?

No need to worry; as long as your designated withdrawal date is on or before April 15, 2013 and your e-filed 2012 return has been accepted, you won't be penalized for late payment even if the funds are withdrawn after the payment deadline.

Funds are usually withdrawn on the payment date selected. If that date happens to fall on a Saturday, Sunday, or bank holiday, the payment is usually taken out the next business day.

What if my account has insufficient funds or I entered the wrong account information?

If the IRS is not able to debit your bank account, the transaction will be treated as if you "bounced" a check.

If your payment to the IRS is rejected by the financial institution due to incorrect account information, a closed account, etc., the IRS will send you a notification letter explaining why the payment could not be processed, along with alternative options for making the payment.

To avoid a possible tax penalty, we highly recommend that you double check your account information before you e-file.

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