Expanding the tax types eligible for electronic payment, the Internal Revenue Service is now accepting card payments for certain balance-due business taxes through Official Payments Corp.

The IRS has also determined that the convenience fees paid or incurred by a business making a tax payment with a credit card can be deducted as a business expense.

Official Payments Corp. is a subsidiary of Tier Technologies, a company authorized to provide federal tax payment processing services. Official Payments is the only company that has provided these services since the IRS initiated the program in 1999.

"With the introduction this year of federal electronic tax payment options to businesses, the IRS joins 20 states and the District of Columbia in accepting payments for business taxes and other related business payments," said Tier chairman and chief executive James Weaver, in a statement.

Businesses may now make secure federal tax payments with their American Express, Discover, MasterCard and Visa cards online at www.officialpayments.com, or by calling (800) 272-9829, for the following balance-due business returns:

  • Form 940 Employer's Annual Federal Unemployment Tax Return - Balance Due (2005 tax year only); and,
  • Form 941 Employer's Federal Quarterly Tax Return - Balance Due (for the 2005 and 2006 tax years).

Federal tax deposit payments cannot be paid through the service.

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