Tax Payment Strategy

Today TaxMama hears from Kathy in the TaxQuips Forum with an interesting question.
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  “I thought I read somewhere that I could specify to which year’s taxes I want to apply my payments.
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  For example, if I owe taxes from 1996 through 1999 and then from 2006, I can apply my payments to the taxes due for 2006 first.
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  That way, I’ll be paying the newest delinquency while the collection statue continues on the older taxes.  Is that true?”

Dear Kathy,

I believe that you are correct.

Be SURE that each check you send shows specifically which year you are paying – and that you are paying taxes only. 

Also include a cover letter, which also specifies the information. Staple the letter to the check so IRS cannot cash the check without having separated it from the letter – the check copy will have staple marks.

 It may work. It cannot hurt to try!

 And remember, you can find answers to all kinds of questions about tax payments, and other tax issues, free.
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Where? Where else? At www.TaxMama.com.

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