Messed up EFTPS

[WhiteOleander]

Have a friend (not a client) who has been paying a 2005 debt on an installment with EFT. She found out that she was not having them post it to 2005. She thought they would post it to the oldest debt. But, they have posted it to 2007 ES payments. They told her they cannot move the payments to 2005. And she has 45 days to catch up the '05 payments.

She knows she would get the money back when she files her '07 taxes. But, is it accurate that they cannot move those funds to the year they were meant for?

I've never been a big fan of the IRS EFT syystem. I've seen them mess up some other things too.

[Golden Rocket]

Checks are no better

Oleander, I haven't had any better results with paper checks. They still apply them wherever they want, and I believe if a taxpayer is severely behind, they retain the right to apply them in any way they desire.

It is a little bit unusual, however, that they are not applying to the oldest liability first. They normally do this in due course so they can divert payments from current debts, and then create non-payment penalties on the current debts.

I believe they should be keeping a record of EFPs, as they should be able to specify the type of tax and the tax period when they enter the EFP into the system. Keeping a track record of these payments, with the acknowledgement #s, might be of some use if you ever get the chance to bring this to IRS attention.

[ED SMITH]

Who told her??

Unless she owes over $100,000, she talked to a someone in ACS collections. THEY couldn't move it because they were trained to or didn't have the instructions or procedure to do so.

She should contact the Taxpayer Advocates Office and get it straightened out.
She could also call ACS again and try someone else. It might get results.

[RJM]

I agree with Ed. Just call and talk to someone else. I have never had a problem getting IRS to change an application period. Also, note that EFTPS online will provide a history of payments and dates credited.

[WhiteOleander]

Thanks everyone. She actually went to an IRS center. But, I have no confidence they had the correct answer.

I will tell her to contact the advocate's office.

[bertrans]

Misposted payments

The Taxpayer Advocate is fine; however, I don't see why the IRS couldn't simply transfer the payments, per the TP's statement. The only payment that cannot be transferred is credit elect. Payments that post as estimated payments can easily be moved at the TP's request. Is there anything 'unusual' going on with your client's account?

[DaveO]

Try e-services

I have had success in getting payments correctly applied by using e-services. I even had one case were they advised me not to correct the payments since it would result in more penalties.