Electronic Federal Tax Payment System (EFTPS)

To facilitate the collection and reporting of Federal tax payments, the Treasury and IRS created the Electronic Federal Tax Payment System (EFTPS) (Off-site Link). This system has been specifically designed to interface with the Treasury Tax and Loan (TT&L) Service, making it a convenient and efficient way for you to report and pay federal taxes for your customers.

For further information on EFTPS, click here (Off-site Link). Federal tax payments can be processed through EFTPS by one of two ways.

Future-Day Payments

The majority of taxpayers should use ACH Debit or ACH Credit to report and pay their taxes.

ACH Debit

At least one day before the tax due date, taxpayers access EFTPS through the Internet, a touch-tone telephone or PC software. Based upon this input, an ACH Debit is originated to your institution.

ACH Credit

At a taxpayer’s request, your institution would originate an ACH Credit to the U.S. Treasury at least one business day before the tax due date.

Same-Day Payments

The Federal Reserve Electronic Tax Application (FR-ETA) operates the same-day reporting mechanism, via Fedwire®, available for business taxpayers who cannot report their tax liability one day in advance of the tax due date via ACH. Refer to the Making EFTPS Same-Day Federal Tax Payments (PDF).

Like other Fedwire funds transfers, a same-day Federal Tax Payment wire (Typecode 1000) settles immediately by debiting your institution and crediting the Treasury. For Retainer and Investor institutions, assuming your institution has sufficient capacity, TT&L will increase the balance in your TT&L account and credit your own or your correspondent's Reserve account.

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