IRS's "Hold" on Estimated Tax Amount

[NSNM]

Upon e-filing a tax return today, client scheduled estimated tax payment electronically with the return
for dates 09/15/2013 and 01/15/2014.

Question:
Does IRS put a "Hold" for the amount of estimated tax on the designated bank account as soon as it
receives the return,
or
attempts to withdraw the amount on the scheduled dates without putting a "Hold" on the account.

[FEDUKE404]

Hold unlikely

I would seriously doubt how/if the IRS could put a "hold" on a future debit, or debits, from a taxpayer's bank (usually checking) account.

Many (most) of my clients with US estimated tax payments choose the future debit, usually four payments, at the time of efiling the original return. Along a similar line, they also select an automatic debit of any balance due of current taxes, with a date they get to select. For those we usually select something in the range of April 10th.

I do remind them to be sure to have the money in the account on the dates involved.

FE

[Snaggletooth]

Wrong Question

I think the taxpayer's problem/question is with his bank, not the IRS.

We know that on the specified date the IRS will draft the account, so long as there are sufficient funds. At that point they are out of the picture, and do not dictate to the bank how to deal with the fallout, if any.

If there are NOT sufficient funds, it is up to the bank whether to honor the IRS withdrawal and carry the overdraft in your clients' account. They do not have to pay the IRS if funds are not there.

I would encourage the client to make sure funds are available. If the IRS does not get their money for lack of funds, this is paramount to a bounced check. The last time I had a client deal with a NSF check, the IRS charged them a $650 fee for bounced check charge.

[ATSMAN]

Estimated Tax Paid By Coupon and Paper Check

There are many small business owners who do a very poor job reconciling their business checking accounts. I suggest to them to pay their quarterly estimated taxes with a paper check just to avoid the NSF situation, that can be very costly.

I know IRS is pushing everyone to go electronic, but it fails to take into account the reality of many small business owners.