Estimated Taxes: use DirectPay or set up IRS Online Account?

[Ian S]

I'm considering going with online estimated tax payments for the foreseeable future and wonder if the hassle of setting up an IRS online account (as opposed to DirectPay) is worth it. If I go with DirectPay and decide to later set up an IRS account, how much history will I be able to access? I suppose checks are still a viable option but I wonder which payment option provides the most certainty of payments not going astray.

 

[audreyh1]

We use the EFTPS - electronic federal tax payment system. You set up a link to a bank account and schedule payments ahead of time. Super convenient. I can see at least 16 months of payment history. Been using it for 20 years, no problems.

If you are paying taxes next Tuesday you don’t have time to set up your EFTPS account, but you might consider it for future payments.

 

[bizlady]

+1 on EFTPS. Scheduling in advance and ability to change those payments is nice. Recently used DirectPay to assist DB in paying his taxes, and I think only 2 payments could be scheduled- what his balance owed was and Q1 2023

 

[audreyh1]

That’s right about changing the scheduled payments if needed. I have occasionally canceled the Q4 payment or changed it (you actually cancel and then schedule a replacement).

 

[RetiredAndLovingIt]

I use Direct Pay to pay my estimated taxes and yes you can only schedule 2 at a time. I go back a couple of weeks later and schedule the other 2 and I'm done, easy-peasy.
I print the confirmation so I've had no need to look at my history (Yet)

 

[Willers]

Setting up an IRS account is easy (IMHO) and I like to use Direct Pay so I can see the payment history and use it as a double check that payments have posted. I am able to see payment history back as long as I've been using it (since 2018). My income is variable so my estimated payments are as well. Because of that I don't pre-schedule payments.

 

[audreyh1]

My bank also notifies me that the IRS made a withdrawal in addition to the EFTPS site showing a completed payment in their history.

 

[RunningBum]

Another plus for EFTPS is that you get a reminder email a few days before each payment, just in case you have to move money into your checking account for it.

 

[cathy63]

I'm considering going with online estimated tax payments for the foreseeable future and wonder if the hassle of setting up an IRS online account (as opposed to DirectPay) is worth it. If I go with DirectPay and decide to later set up an IRS account, how much history will I be able to access? I suppose checks are still a viable option but I wonder which payment option provides the most certainty of payments not going astray.

If you setup an irs.gov account, you can review 5 years of payment history including payments made by check, eftps and Direct Pay. You can also see scheduled and pending payments.

Any electronic method is more reliable than paying by check. Direct Pay and EFTPS are both equally reliable. I believe that payments scheduled while you are logged in to irs.gov are Direct Pay payments. They just ask you for less info when setting them up. If you set them up without logging in, you have to enter some additional info to make sure they get credited to the right account, but if you are already logged in you just enter the amount, reason for payment and bank info.

 

[audreyh1]

Another plus for EFTPS is that you get a reminder email a few days before each payment, just in case you have to move money into your checking account for it.

Yes, they started doing this a few years ago.

They also send a confirmation email now when you schedule a payment. All very handy.

 

[Sunset]

This year I used the EFTPS and scheduled the entire tax year payments. So now no worries about forgetting to pay !

Of course I have to keep enough $$ in the checking account to cover it.

 

[erkevin]

I use my IRS account to pay estimated and 1040-owed taxes. It shows multiple years of payment history

 

[jebmke]

We use the EFTPS - electronic federal tax payment system. You set up a link to a bank account and schedule payments ahead of time. Super convenient. I can see at least 16 months of payment history. Been using it for 20 years, no problems.

If you are paying taxes next Tuesday you don’t have time to set up your EFTPS account, but you might consider it for future payments.

I've been using EFTPS for decades. It takes a few days to get the account set up and linked but then it is easy to use. They have never missed a debit date in all these years -- very precise. I auto-push the money into my checking a couple of days in advance and the IRS sucks it out on time. It never sits in checking more than a day or so.

 

[audreyh1]

This year I used the EFTPS and scheduled the entire tax year payments. So now no worries about forgetting to pay !

Of course I have to keep enough $$ in the checking account to cover it.

After many years I got brave and linked the IRS to one of my high yield savings accounts long ago. So the money is there all year.

Now I have two different sets of login credentials, one for each account. How I log in determines which account they use. Interesting, but works well enough for me.

 

[W2R]

I use EFTPS too, ever since I read a post by Audrey about it (back when dirt was young).

EFTPS is GREAT. I can set up all my payments for the entire year in about a half hour or less, and they are taken from my checking account promptly when due. All I normally do after setting up the payment schedule, is to make sure there's plenty of money in checking to cover the payments. Maybe I should do what Audrey is doing, and link EFTPS to a higher yield savings account.

 

[Midpack]

I've also been using EFTPS for years, never had any issues whatsoever. And I am able to pay my estimated state taxes online as well, your state may well have a similar program. Estimated taxes online are a breeze IME. I would HATE to snail mail in a check again...

 

[scrabbler1]

I set up an account with irs.gov last year so I could track the progress on my refund. I used it this year to make my payment instead of using the more general electronic method (the way Cathy63 described the difference) I used before I set up the account.

I did see a message when I signed into my irs.gov account this time, though. The message said I had to set up my account again because the IRS was going to use a different account system. The current account system was still good for this tax filing season, just not good for next time's. Anyone else see this message? Anyone know why this is going on?

Once I see that my 2022 return has been received and processed, I'll redo the account. I filed on paper a month ago, so I may not see it appear in my account until the end of this month.

 

[jebmke]

After many years I got brave and linked the IRS to one of my high yield savings accounts long ago. So the money is there all year.

Now I have two different sets of login credentials, one for each account. How I log in determines which account they use. Interesting, but works well enough for me.

I never thought of that. I've been thinking of linking my AMEX account but didn't want to break the link to my checking in case I decided to switch HYS accounts. More likely that I'd switch (banks for) savings than checking.

 

[audreyh1]

I never thought of that. I've been thinking of linking my AMEX account but didn't want to break the link to my checking in case I decided to switch HYS accounts. More likely that I'd switch (banks for) savings than checking.

Conveniently, you will simply get a second set of login credentials, so you can even switch back and forth as needed. You have to pay attention to the details, but the payment preview clearly states which bank and account number they will be pulling from.

I’m using my Amex Bank high yield savings account.

 

[Dash man]

EFTPS just took their donation yesterday. I haven’t set up the rest of the year yet since I’m not sure when we’ll do another Roth conversion. But the system is easy and reliable.

 

[Dtail]

Been lazy, just using Direct Pay for now.

 

[rk911]

We've used EFTPS for years now. No issues. Takes me maybe 5-minutes to schedule the 4-quarterly payments.

 

[Go4it]

Pay with a rewards credit card

You can pay estimated taxes with through one of the credit card payment websites specified by the IRS, such as pay1040.com

They will charge you a fee, 1.875% for pay1040.com, but if you have a decent rewards credit card like the Bank of America, premium reward, 2.625% rebate, or the Fidelity rewards card, 2% rebate, you’ll make some money on it.

You get a detailed receipt and confirmation through email.

For advanced users you can use the payment to get an opening bonus for a new credit card.

 

[Dtail]

You can pay estimated taxes with through one of the credit card payment websites specified by the IRS, such as pay1040.com

They will charge you a fee, 1.875% for pay1040.com, but if you have a decent rewards credit card like the Bank of America, premium reward, 2.625% rebate, or the Fidelity rewards card, 2% rebate, you’ll make some money on it.

You get a detailed receipt and confirmation through email.

For advanced users you can use the payment to get an opening bonus for a new credit card.

I use this credit card net rewards/fee concept to pay my property taxes.

 

[Ian S]

Thanks to everyone for the useful comments. I decided to use DirectPay this time but will consider the alternatives suggested. One question I have is the choice between EFTPS and an IRS Online account: do folks pick one or the other or both?