Expert breaks down all the options for paying off your taxes

This week we kicked off tax filing season, and while there are a lot of things you can do with your taxes, one thing you can’t do is not pay if you owe money.

KIRO 7 spoke to a tax expert who says there are options to pay, but also some pretty stiff rules around the process if you do indeed owe money.

Mark Steber is Chief Tax Information officer with the tax preparation firm Jackson Hewitt, and he says a lackadaisical approach to paying your taxes could come back to haunt you in a big way.

“Many people say, ‘I don’t have the money yet, I’ll get an extension and pay this summer,’” he detailed. “That’s not how it works.”

When the Internal Revenue Service comes calling, not paying is not an option. And Steber says if you don’t pay the 90% of your taxes throughout the year -- and all of what you may owe by tax day -- you can get a failure to pay penalty, or a late payment penalty. If you ignore it, all a failure to file penalty could also be assessed.

He says those types of penalties can add up and sometimes add up to more than your tax liability.

“The IRS has established a host of pay-over-time (options) which avoid all those penalties,” he said. “There is a small interest surcharge on it, but I will tell you, if you owe, do not ignore the tax deadline.”

Steber says starting to pay early if you owe money, an early payment allows you to tweak the payment program that best fits your needs.

He also stresses the fact that missing the ax deadline could result in some pay-over-time features not being available to you as as taxpayer.

Despite the potential penalties there are a simple range of options to pay:

• Pay over time through a plan you select.
• Use a credit card
• Borrow from another savings account or a retirement account

Steber says the longer people wait the more difficult it gets to pay since the failure to pay penalty and failure to file penalty are 25% of the balance you owe.

Also filing is not the same as paying -- you could file your taxes tomorrow, but you still have until Tax Day on April 15 to pay.

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