1. Introduction: What is Form 13287?

IRS Form 13287, officially titled Bank Payment Problem Identification (and historically referred to as the Bank Problem Identification Worksheet), is a specialized administrative tax document issued by the Internal Revenue Service (IRS). The IRS is a bureau of the United States Department of the Treasury responsible for administering the federal tax code and collecting payroll and corporate taxes.

Unlike personal income tax returns, Form 13287 is not a form you complete during annual filing season. Instead, it is a dispute worksheet used when an electronic tax payment fails or arrives late because of a financial institution’s processing delay rather than a taxpayer’s mistake.

When a bank’s error leads to late tax deposit penalties against a business, Form 13287 allows the bank to officially accept responsibility. Once completed, the IRS removes the unfair penalties from the taxpayer’s account and recovers the financial loss directly from the bank.

2. Purpose of the Form

Employers and business owners are legally required to make prompt federal tax deposits (FTDs) for employee payroll withholdings, Social Security, Medicare, and corporate taxes. Under Internal Revenue Code Section 6656, if a tax deposit arrives even one day late, the IRS automatically assesses a Failure to Deposit (FTD) penalty ranging from 2% to 15% of the unpaid amount.

Many businesses initiate their tax payments through their commercial banks via automated clearinghouse (ACH) debits, wire transfers, or the Electronic Federal Tax Payment System (EFTPS). However, banks occasionally experience computer outages, batch transmission failures, or wire desk bottlenecks that delay forwarding those funds to the U.S. Treasury.

Form 13287 exists to resolve this specific injustice. It gives the financial institution a formal mechanism to admit fault, document the technical timeline of the payment, and authorize the Federal Reserve Board (FRB) to debit the bank for the lost interest (“cost of funds”). In return, the IRS abates the FTD penalty and refund charges assessed against the blameless employer.

3. Who Needs to File This Form

Form 13287 involves a three-way coordination among the business taxpayer, the financial institution, and the IRS. You interact with or file this form if you fall into one of the following groups:

Business Taxpayers Facing FTD Penalties: Employers and companies that received an IRS penalty notice (such as Notice CP161 or CP207) for a late payroll tax deposit despite instructing their bank to transfer the funds on time.
Commercial Banks and Financial Institutions: Bank operations officers, wire transfer managers, or ACH processing units whose internal delays caused a client’s federal tax payment to post past the legal deadline.
Third-Party Payroll Processors: Payroll service bureaus that interface between business bank accounts and federal depository systems when bank-side transmission glitches occur.

While the business taxpayer initiates the dispute by contacting the IRS, the bank’s authorized representative must complete and sign the critical verification sections of the form.

4. Who Is Exempt / Not Required to File

Form 13287 is reserved strictly for deposit delays caused by third-party financial institutions. You do not need to file this form in the following situations:

Taxpayer-Caused Delays: If you initiated your payment after the daily bank cutoff (such as after 8:00 p.m. Eastern Time on the day before the due date in EFTPS) or provided incorrect account numbers, you cannot use Form 13287. You must request penalty relief under general “reasonable cause” provisions instead.
Insufficient Account Funds: If your bank rejected or delayed the transfer because your business account lacked sufficient funds, the bank will not accept responsibility, making this form inapplicable.
Individual Tax Filers: Individuals paying personal balance-due amounts on Form 1040 do not make Federal Tax Deposits under Section 6656 and do not use this worksheet.
First-Time Penalty Abatement (FTA) Candidates: If you have a clean three-year compliance history, the IRS can often remove a minor penalty under the First-Time Abate policy without requiring bank worksheets.

5. When to File

Form 13287 is an event-driven form triggered by an IRS balance-due notice or penalty letter. It does not follow an annual tax season calendar:

Immediate Action Required: You should initiate the process as soon as you receive an IRS notice assessing an FTD penalty for a deposit you know was scheduled on time.
The 30-Day Response Window: Once the IRS faxes or mails Form 13287 to the taxpayer or the bank, the agency generally allows 30 calendar days for the bank to complete, sign, and return the worksheet.

Failing to secure the bank’s signature within this 30-day window can cause the IRS to close the penalty reconsideration and resume collection actions against the business.

6. Where and How to File

Form 13287 cannot be submitted through consumer tax preparation software or commercial e-filing portals. It is an internal administrative worksheet handled directly by IRS specialized operations units.

Typically, an IRS customer service representative or tax examiner will send Form 13287 directly to you or your bank after you contest the penalty by phone or correspondence. The bank’s operations representative fills out their portion and returns it via dedicated fax or mail.

You or your bank must send the completed form to the specific IRS address as per instructions on the penalty notice or accompanying IRS correspondence cover sheet. If mailing paper copies, use certified mail with return receipt requested to confirm delivery before the 30-day deadline expires.

7. Step-by-Step Instructions to Fill the Form

Form 13287 is divided into two primary parts: Section I is completed by the financial institution, and Section II is reserved for internal IRS processing.

Section / Part	Required Information	Detailed Instructions
Section I, Part 1	Taxpayer Information	Enter the business Employer Identification Number (EIN), legal company name, and full mailing address.
Section I, Part 1	Bank Identification	Provide the bank name, address, bank EIN, and the 9-digit American Bankers Association (ABA) routing transit number.
Section I, Part 1	Bank Contact Person	List the full name, corporate title, and direct telephone number of the bank officer managing the inquiry.
Section I, Part 2	Payment Details	Enter the total number of delayed payments and the exact dollar amount of the transfer.
Section I, Part 2	Transaction Timeline	Record the date the taxpayer requested the transfer, the date the bank received instructions, and the actual posting date.
Section I, Part 2	Explanation of Delay	The bank must explain what went wrong (e.g., automated system malfunction, wire backlog, or misrouted file).
Section I, Part 3	Bank Authorization & Signature	An authorized bank official signs and dates the document, authorizing the Federal Reserve to charge the bank for the lost interest.
Section II	IRS Internal Processing	Leave blank. IRS personnel record tax codes, tax periods, penalty abatement inputs, and examiner employee numbers.

Understanding the Bank’s Legal Authorization

The core of Form 13287 is the signature block in Section I. When the bank official signs this section, they legally acknowledge that:

The taxpayer gave timely instructions with sufficient available funds.
The delay occurred solely through the fault of the financial institution.
The Federal Reserve Board is authorized to charge the bank’s reserve account for the government’s loss of funds during the delay period.

8. Required Documents/Information Needed Before Filling

Before submitting Form 13287 to your bank for signature, gather the necessary transaction records to prove your timely payment request:

IRS Penalty Notice: A complete copy of Notice CP161, CP207, or Letter 852-C showing the assessed penalty and tax period.
Proof of Timely Instruction: A computer confirmation, bank debit acknowledgment, or wire request sheet showing you submitted the payment before the cutoff deadline.
Bank Account Statements: Checking account statements proving your business maintained sufficient cleared funds to cover the tax deposit on the date requested.
Tax Return Details: The tax form number (such as Form 941, Form 940, or Form 1120) and the specific tax period/quarter involved in the dispute.
Multi-Client Spreadsheet (if applicable): If a bank processing glitch affected multiple client businesses simultaneously, attach a spreadsheet listing each company’s EIN, payment amount, and tax period.

9. Common Mistakes to Avoid

Submitting an incomplete or mismanaged Form 13287 will lead to an immediate denial of penalty relief. Avoid these frequent mistakes:

Missing Bank ABA Number: If the bank officer forgets to write down the bank’s 9-digit ABA routing transit number, the Federal Reserve cannot charge the bank, and the IRS will reject the form.
Missing Bank Signature: The IRS will not accept verbal admissions of fault from a teller or branch representative. The form must carry the signature of an authorized bank operations official.
Submitting for Insufficient Funds: If the transaction failed because your checking balance was short, the bank cannot sign Form 13287. Trying to use this form for non-sufficient funds (NSF) cases is a waste of time.
Missing the 30-Day IRS Deadline: If your bank takes too long to research the issue and misses the 30-day reply deadline, the IRS will enforce the penalty against your business.
Failing to Follow Up: Do not assume sending the form instantly removes the debt. Monitor your IRS business tax account until you receive written confirmation of penalty abatement.

10. Penalties for Non-Filing or Errors

Because Form 13287 is an optional penalty abatement request, there is no separate monetary fine for failing to file it. However, the indirect consequences are costly:

Full Penalty Liability: If the bank does not execute Form 13287, the business remains 100% legally liable for the Failure to Deposit penalty (up to 15% of the total tax deposit).
Compounding Interest: Under federal law, statutory interest accrues daily on both the unpaid tax and the penalty balance until fully resolved.
IRS Collection Actions: If the penalty remains unpaid and uncorrected, the IRS will proceed with enforced collection actions, including federal tax liens and bank levies against your operating accounts.
Perjury Sanctions: Submitting fraudulent transaction dates or false statements on federal forms is a federal offense under 18 U.S.C. Section 1001, punishable by fines and imprisonment.

11. Related Forms or Schedules

Form 13287 operates alongside several payroll reporting forms and penalty relief procedures:

Form 843: Claim for Refund and Request for Abatement
Form 941: Employer’s Quarterly Federal Tax Return
Form 940: Employer’s Annual Federal Unemployment (FUTA) Tax Return
Form 945: Annual Return of Withheld Federal Income Tax
Form 8646: Checklist to Identify Delays in Processing Federal Tax Deposits
Notice CP161: Balance Due – Taxes and Fees on Form 941
Notice CP207: Proposed Penalty for Failure to Deposit
Publication 15 (Circular E): Employer’s Tax Guide

12. Frequently Asked Questions

What is a Failure to Deposit (FTD) penalty?

An FTD penalty is an administrative fine charged by the IRS under IRC Section 6656 when an employer fails to deposit employment or excise taxes on time, in the correct amount, or through the required electronic method (EFTPS). It ranges from 2% for payments 1 to 5 days late up to 15% for delinquent deposits subject to collection notices.

Does the business owner or the bank fill out Form 13287?

The business owner provides account and tax details, but the bank’s wire transfer or ACH operations department must fill out the payment history, provide the ABA routing number, explain the internal error, and sign the official authorization.

What if my bank admits the error verbally but refuses to sign Form 13287?

If your bank refuses to sign the form, the IRS cannot charge the bank for the lost interest. In this case, you must request penalty relief directly through Form 843 by submitting written bank correspondence, confirmation printouts, and bank statements to prove “reasonable cause” under standard penalty relief rules.

Can Form 13287 be used for personal income taxes?

No. Form 13287 is specifically engineered for Federal Tax Deposits made by business entities (such as payroll withholding, corporate taxes, and excise duties). It does not apply to personal income tax payments made on Form 1040.

What does “cost of funds” mean on Form 13287?

“Cost of funds” refers to the interest earnings the U.S. Treasury lost because the bank held or delayed the tax money instead of delivering it on the required date. By signing Form 13287, the bank agrees that the Federal Reserve can debit its account for that lost interest.

Does filing Form 13287 stop interest from accruing on my account?

Filing the form does not immediately stop system calculations. However, once the IRS processes the approved Form 13287, both the FTD penalty and the interest associated with that specific penalty will be removed from your tax account retroactively.

13. Conclusion: Key Takeaways Summarized

When an electronic tax deposit arrives late through no fault of your own, you should not be forced to pay IRS penalties. Keep these critical points in mind when dealing with Form 13287:

Designed for Bank Errors: Form 13287 applies exclusively to late federal tax deposits caused by commercial bank delays or glitches.
Requires Bank Admission: Your financial institution must formally sign the document, provide its ABA routing number, and accept financial responsibility.
Act Within 30 Days: The IRS enforces a strict 30-day response window for returned worksheets, so coordinate with your bank immediately upon receiving a penalty notice.
Keep Thorough Records: Always retain electronic payment confirmations and bank statements proving you scheduled the transfer on time with sufficient funds.

IRS Form 13287 Guide: Bank Payment Problem Identification