Instead of sending a electronic payment for federal 1040, client erroneously made the selection as a 965 payment.
Sec 965 is for "Deferred Foreign Income Corporation" (DFIC). The client is a US citizen with a 1065 domestic partnership business and never had any foreign income
My question is how to proceed with the 965 refund.
Thank you
Phil
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If the client can afford it - probably they should pay the balance due for 1040. I'd be nervous that getting the Sec965 payment refunded or moved to the 1040 would go beyond the April 18th deadline.
Interesting your client chose this out of all the options, lol.
Agree with Susan someone would want to call the IRS.
The reason is that 965 installments are administered separately from regular tax liabilities. With each installment received, the IRS would reconcile that against the taxpayer's outstanding 965 installment for prior years and the installment due for the current year. Overpayment, if any, would then be applied or refunded.
If your client doesn't have any 965 liability, the payment erroneously designated for 965 should then be refunded if not for the balance due on the 2022 return.
If the client can afford it - probably they should pay the balance due for 1040. I'd be nervous that getting the Sec965 payment refunded or moved to the 1040 would go beyond the April 18th deadline.
Thanks for your reply.
The exact thought went thru my mind.... of all the forms the client selected 965. I will be super specific when client pays online next time...
I will have the credit apply to the 1040 tax liability.
Thanks.
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