Treasury Tax and Loan Depositaries and Payment of Federal Taxes

Résumé

The Internal Revenue Code mandates that certain taxpayers use electronic funds transfer (EFT) for the payment of Federal taxes. Temporary regulations published by the Internal Revenue Service (IRS) implement this requirement, providing guidance to taxpayers relating to the deposit of taxes using EFT mechanisms. These proposed regulations are necessary for the operation of the Electronic Federal Tax Payment System (EFTPS). The EFTPS is projected to begin operation in the fall of 1996. These regulations provide rules for financial institutions and Federal Reserve Banks that use EFT mechanisms to process Federal tax payments through the EFTPS. The regulations also update the rules governing Treasury's investment program. The Small Business Job Protection Act of 1996 provides that certain taxpayers are not required to begin using EFT until July 1, 1997 (rather than, as originally scheduled, on January 1, 1997). This change does not affect and is not addressed in these regulations.