Discussion:Overpaid Estimate

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Discussion Forum Index --> Basic Tax Questions --> Overpaid Estimate


Discussion Forum Index --> Tax Questions --> Overpaid Estimate

Tabatha (talk|edits) said:

30 April 2011
My client wanted to make a $1000 estimated payment for 2011 on the IRS website. Well, he added an extra "0"...and accidentally made a $10,000 payment. The payment went thru...and his bank account is now overdrawn.

Is there any way that he can get the $9000 back from IRS at this point, and just leave $1000 there?

Cottcpa (talk|edits) said:

30 April 2011
not sure, I'd get a POA and call the practitioner line. The bright side is that he's probably done paying taxes this year.

DavidG (talk|edits) said:

1 May 2011
How did it go through if there was enough money in his account? Seems to me just like writing a NSF check, he won't be credited with making the payment and the IRS will charge the standard penalty for sending a NSF payment.

Tabatha (talk|edits) said:

1 May 2011
I think he had overdraft protection. (He said his account was showing a negative balance.)

I was hoping that he didn't...and it would bounce.

Well, he went to the bank yesterday, and they "red flagged" it........

I'll call the IRS and see what can be done if it goes thru. I have a feeling it might be time for the taxpayer advocate.

Spell Czech (talk|edits) said:

1 May 2011
Once upon a time, there was a procedure to "move" mistaken payments to other accounts. It might have been Form 911, back in the 80s.

Tabatha (talk|edits) said:

2 May 2011
Form 911 is now for the taxpayer advocate.

There must be a way...I mean this is obviously a mistake. My clients income is about $40,000/year....and I'm sure the payment is his entire lifetime savings. He's Indian, and must have been thinking "in rupees".

He was calling the IRS on Friday afternoon but, well, you know how that can be....especially with a "panicked taxpayer" and and IRS rep.

Spell Czech (talk|edits) said:

2 May 2011
AHA! There's a reason that we write out "One Thousand and no/100" on a *check*! I hope your client can get this fixed up.

Tabatha (talk|edits) said:

2 May 2011
There is! It took the rep about 45 minutes to find the solution, but she did.

Because he is NOT self-employed, does not have a history of making estimates and does not owe anything he can request to get it back once it clears...in about 2 weeks.

The client works for U of PA...and for some reason they aren't withholding federal tax anymore for "him and people in his position".

So, it does look promising. I don't know what the procedure is yet....but I'll let you know.

Spell Czech (talk|edits) said:

2 May 2011
"...U of PA...they aren't withholding federal tax anymore...." There's a tax issue under *every* rock, isn't there!!

Captcook (talk|edits) said:

2 May 2011
I thought federal withholding was statutory.

Tabatha (talk|edits) said:

2 May 2011
Lots of times I see W-2s with $0 withholding

But FICA is withheld.......

For example...I have a client who is a household employee. $0 withholding...for years

Death&Taxes (talk|edits) said:

2 May 2011
"they aren't withholding federal tax anymore"

We have no idea what he does, or whether the position changed. And you don't mention Social Security, Medicare, Pennsylvania tax or Philadelphia Wage Tax. So could it be something he did with his W-4 form? Or this is a taxable scholarship? In my experience the U of PA doesn't usually skate close to the edge in employment situations.

Captcook (talk|edits) said:

2 May 2011
What I mean is, based upon a certain rate of pay, the withholding should not have changed any more than the withholding tables or the information on his W-4 changed. It is a matter of facts applied to the statute and not a matter of internal company policy.

Death&Taxes (talk|edits) said:

2 May 2011
"Lots of times I see W-2s with $0 withholding

But FICA is withheld......."

so Tabatha is telling us there is also no FICA withheld....her last post crossed mine in posting.

Anyway, the money is coming back. And I do trust the U of P to do things right.

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