Electronic Funds Withdrawal for Tax Payments

Electronic Funds Withdrawal (EFW) is an integrated e-file / e-pay option to pay your 2290 tax. You can use this payment option to submit one or more payment requests from your designated bank account. EFW method is also known as Direct Debit.

1. EFW full form and meaning 2. Information required to pay taxes using EFW 3. EFW - how it works?4. Advantages of EFW 5. Is EFW Safe for tax payment?6. Checking a confirmed EFW payment 7. Cancelling EFW Transaction 8. Difference between EFW & EFTPS

Details Required to Pay Taxes with Electronic Funds Withdrawal

You will need the following information:

Banking information
Routing number
Checking or savings account number
Your payment or withdrawal amount
The date you want your fund withdrawn

How does Electronic Funds Withdrawal Work?

When you make your IRS form 2290 payment or schedule an HVUT payment for the next tax year using EFW, you will be prompted to enter the following details:

Your banking information
The amount you want to pay
The date you want your fund withdrawn

Once you enter these details, the system will create an electronic debit request and send it to your bank account for processing on the designated payment date. The amount will be debited on the date you selected.

Note: If the debit date is a non-banking day, such as a weekend or holiday, the amount is withdrawn on the first business day following the non-banking day.

Benefits of Electronic Funds Withdrawal:

It is convenient and free of cost.
It is safe and secure: payment information is used only for the tax payment(s) authorized.
Bank account information won’t be disclosed for any reason other than for processing authorized payment transactions.
Your HVUT payment is debited from the bank account within 24-48 hours.

Is Paying Taxes by Electronic Funds Withdrawal Safe?

Yes. Electronic Funds Withdrawal is one of the safest and easiest ways to pay your HVUT. Your payment information will be used only for the tax payment(s) authorized. Also, your bank account information won’t be disclosed for any reason other than for processing authorized payment transactions.

[ Read: How to file 2290 Online? ]

How to Check if Electronic Funds Withdrawal was Confirmed?

There are many ways to confirm your EFW withdrawal:

A message will be displayed on the Electronic Funds Withdrawal page once you submit your request. You can take a print out of the page for your records.
A confirmation number will be displayed along with the debited amount  on the confirmation page. Although it does not confirm fund withdrawal, it confirms the request submission.
You can refer your bank statement to know if the fund is withdrawn.

EFW Cancellation and Common Errors

In certain circumstances, you might have to cancel your EFW transaction. But before you cancel the transaction, keep the below points in mind:

You cannot make changes to your payment information such as account details, paid amount or date once your return is accepted
If you want to make changes to your information, you need to cancel the payment and choose a different settlement method
If you want to cancel a transaction or report problems such as bank closures, loss of bank account details, or unauthorized transaction activity, call the IRS e-file payment services at 1-888-353-4537
You need to wait 7 to 10 days after the return was accepted before contacting the IRS to inquire about your settlement
You should request for cancellation at least two business days before the scheduled settlement date before 11:59 p.m. ET
If your bank rejects the request for payment due to a closed account, insufficient funds, or incorrect account information, the IRS will notify you by mailing a letter to your registered address, explaining the reason for payment cancellation and alternate ways to pay the amount due
If your financial institution is unable to process your payment request, you will be responsible for making other arrangements to pay the tax amount and penalties & interest incurred

Electronic Funds Withdrawal Vs EFTPS

There are two ways to file Form 2290:

Electronic Funds Withdrawal (EFW)	Electronic Federal Tax Payment System (EFTPS)
EFW offers e-file and e-pay in a single step.	EFTPS offers tax payment via the internet and over telephone.
EFW is free of cost. But payment cannot be processed on weekends.	EFTPS is free, and is available 24x7. Payments can be scheduled up to 365 days in advance. Scheduled payments can also be changed or cancelled.
EFW requires a tax software for transferring funds.	EFTPS payment does not require any software. You can create an EFTPS account and carry out transactions.
EFW is safe and secure where the payment information is used only for the tax payment(s) authorized.	EFTPS is quick, secure, and accurate as online payments require three unique pieces of information for authentication: an EIN; a PIN; and an Internet password. Phone payments require your PIN as well as your EIN/SSN.
If the payment date requested is a weekend or bank holiday, the payment will be withdrawn on the next business day.	For EFTPS payments to be on time, you must submit the payment by 8:00 p.m. Eastern time the day before the date the payment is due.
The payment amount will be debited in a single transaction. No recurring or partial withdrawals will be made.	EFTPS does not carry out recurring or partial withdrawals.

[ Read: EFTPS Payment ]

Final Thoughts

Electronic Fund Withdrawal is one of the best way to pay your heavy Highway Vehicle Use Tax if you are filing through a tax processing software. When you file your HVUT 2290, you can opt for EFW as your mode of payment and experience a safe and smart tax filing experience unlike any other.