Secure payment service from U.S. Treasury can help clients avoid penalties.

• Position: United States

The Electronic Federal Tax Payment System offers businesses and individuals a secure and easy way to pay all federal taxes online or by phone--and possibly avoid IRS penalties. Moreover, it is available free from the U.S. Department of the Treasury.

EPTPS has a secure Web site (www.eftps.gov) through which taxpayers enroll. The enrollment process includes entering a taxpayer's tax ID number and the bank account from which the taxes will be paid. After enrollment, taxpayers will receive by mail their PIN and instructions for obtaining their Internet password. Then they log on, enter their security information (the combination of TIN, PIN and Internet password), and make secure payments for any and all federal taxes 24 hours a day, 7 days a week.

All business clients can use EFTPS. The system offers specific tools to help clients avoid possible IRS penalties:

* Schedule payments in advance--up to 120 days for businesses and 365 days for individuals.

* Make payments weekly, monthly or quarterly.

* Cancel a payment up to 48 hours before the scheduled payment date.

* Receive an immediate Acknowledgement Number for every payment, which is a receipt for the taxpayer's payment instructions and can be used in contacting the IRS.

* Review and verify all payment information thoroughly before submitting the payment to make sure no mistakes have been made.

* Review up to 16 months of EFTPS payment history online to confirm payments have been made.

CPAs who make tax payments on behalf of their clients may want to consider using the free EFTPS Batch Provider software. With a new version scheduled for fall 2005, this software allows CPAs to enroll clients and make up...