Form 1040 - $1 balance due

[dkh]

WTF.... I can't ever remember this happening......  do I tell them to pay ?    

client only has W2 so can't round up/down to eliminate this

[Just-Lisa-Now-]

I have one with a $1 refund.

[dascpa · Accepted solution]

Somewhere it says $1 or less (some people still deal in cents) is not required to be paid or refunded.  I've had many and always tell them to pay the $1 if owed.  Most get a kick out of that the postage and envelope cost as much as the balance due.

[dkh]

Yes, IRS says don't have to pay if less than $1 but can't do cents on the tax return so possibly could be less than $1.    Just wonder if IRS will send notice if taxpayer doesn't pay.

[joshuabarksatlcs]

Years ago, a client got a notice from the state asking for the payment for tax balance of $0.00.  Early generation of computer-generated letters, I guess.  I advised him to send a check of $0.00.   He had kept the letter and check copy (it didn't clear the bank) all the way until the last time I talked to him. 

RIP, though the $0.00 check hadn't clear.

[IRonMaN]

You have the perfect return!  Owing one dollar is what everyone should be shooting for.  Take a picture of the return (maybe even have the clients stand next to the return) to show when folks come to you they get perfect tax planning. 😀

[dkh]

Interestingly enough, client had note in with W2 they want to discuss changing W4.   2020 client owed over $600......guess I'll have to try to convince them it is a perfect return.

[rbynaker]

I had a $0 once (and not because tax was $0!)  I've had a few $1 on the state returns.

Theoretically this is a function of the "new and improved" W-4 process.  It's designed to hit $0 rather than result in a refund.

[IRonMaN]

Yeah, I hit a zero return about 10 years ago.  I've had a few $1 returns over the years.

[dkh]

I too have the $1 state refunds/balance due here and there.... not on federal though.    I know the client has to pay, same as I tell them to do for a $1 due on the state.  I just find it such a waste of - office supplies, postage, checks, IRS staff time.

[rbynaker]

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@dkh wrote:

I just find it such a waste of - office supplies, postage, checks, IRS staff time.

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IRS DirectPay?  EFT withdrawal?  I'm not normally in the payment processing business but I'd make an exception for $1.

[BobKamman]

IRS writes off any balance due under $5.  In the old days I would tell you to file the return with a check, because then you would know they got the return when they cashed the check.  These days, not even that works.  

[PATAX]

@dkh @Do yourself a favor and have the client pay the $1. I always do that for both federal and state. If not there is a possibility that the client could receive a notice and then you may hear from the PIA...

[BobKamman]

Or you could pay the $1 yourself if you're really afraid of hearing from the client about an IRS notice.  Of course, that would not have worked last year when the checks were being cashed by the banks-for-hire but the returns were not being processed once they were shipped to IRS.  Would have been better to send the return directly to the Service Center.  

[IRonMaN]

I would send an envelope with 99 pennies in it just for the fun of it to see if they would send a notice for that other penny 😂

[BobKamman]

Try to remember that IRS workers are real people, just like you. 

Matthew 7:12

Alexei Navalny -- hang in there