Taxpayers Can Now Pay Federal Tax at Participating Retail Stores

By Sally P. Schreiber, J.D.

In a program aimed at individual taxpayers who lack checking accounts or credit cards, the IRS has unveiled a partnership with retail stores (currently only 7-Eleven) to allow these taxpayers to pay their federal tax bill in cash (IR-2016-56). Called PayNearMe, taxpayers can pay up to $1,000 a day at over 7,000 participating stores for a $3.99 fee. The IRS says that many of the stores are open 24 hours a day, 7 days a week.

The new payment process involves registering before paying, as described below, and may take five to seven days, so the IRS stresses that taxpayers should use this method “in plenty of time” before the due date of the payment to avoid penalties and interest. Taxpayers who encounter problems using this method should call the PayNearMe customer service line at 888-714-0004.

The IRS describes the process as follows: Taxpayers should go to the IRS.gov payments page and select the cash option in the “Other Ways You Can Pay” section. They will then receive an email from OfficialPayments.com confirming their information. After the IRS has verified the taxpayer’s information, PayNearMe sends an email with a link to the payment code and instructions.

Taxpayers can then print the payment code or send it to their smartphone, along with a list of the closest 7-Eleven stores. After the store accepts the cash payment, it will give the taxpayer a receipt. Payments usually will post to the taxpayer’s account within two days.

Until now, the IRS has accepted cash payments only at certain IRS offices. (And exact change was required.)

To guard against tax fraud, the IRS reminds taxpayers using this method that they will not receive emails from OfficialPayments.com or PayNearMe unless they initiated the payment process and to be wary of any emails they receive saying there are tax issues involving the IRS or from others in the tax industry.

Sally P. Schreiber (sschreiber@aicpa.org) is a Tax Adviser senior editor.

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