IRS Installment Agreement monthly payment plans help solve most taxpayer problems.
IRS Installment Agreement plans allow delinquent taxpayers to make affordable monthly payments to IRS. These IRS Installment Agreement payment plans allow many people to pay as little as $50 to $75 per month on prior year taxes that can be from $5,000 all the way up to $500,000.
IRS Installment Agreement payment plans are quite common. But getting the best and lowest monthly payment allowed by IRS is tricky and not for amateurs. For a taxpayer who has made such arrangements in the past, this isn’t anything new. But if you are a taxpayer facing this kind of a scenario for the first time, the entire situation can seem overwhelming. The important thing to remember is that an IRS Installment Agreement can be a valuable tool to help you resolve an outstanding federal tax debt.
How does it work? Simple. Let’s say you owe the IRS $10,000 but cannot afford to pay back the full amount in one lump sum payment. Within reason, the IRS will allow you to make monthly payments that will cover tax plus penalties plus interest for all unpaid taxes. We have negotiated these agreements to be as low as $25 per month for taxpayers who have large tax debts.
Once we have completed your IRS Installment Agreement negotiation, the IRS will typically accept your payment plan for at least three years before attempting to increase it. As long as you continue to make the monthly payments on schedule, the IRS will not pursue further collection action against you, like an IRS Bank Levy or IRS Wage Levy. The only other stipulation to this agreement is that you must file your subsequent tax returns on time and pay all of the tax on those returns. If you don’t stay current on your tax returns and payments, then you will default on your agreement and the IRS will begin enforced collection activity again.
IRS Installment Agreement – A Few Benefits and Requirements
- Negotiated favorable filing deadlines
- Prevention of the IRS from pursuing harsh collection tactics against you
- Affordable monthly payments
- Might be able to pay as little as $15 to $25 per month
- Can even buy a new car while in this status
- The return of levied funds (if applicable)
- Usually good for at least three years – often longer
- A great choice for families with tight budgets
- Lots of communication with highly trained IRS Installment Agreement representatives
- A lot of documentation requirements
- Might last long enough for the CSED to expire
- Can negotiate a new agreement 3 to 5 years later
- Must file all following tax returns on time and pay all taxes due on those returns
Why would an IRS Installment Agreement Payment Plan be almost as desirable as IRS Not Collectible Status?
Well, quite simply, classification of unpaid taxes as IRS Not Collectible is the best of these two possibilities. IRS Uncollectible Status totally and completely halts the IRS from pursuing collection from you. That means no IRS Wage Levy or IRS Bank Levy forms will be delivered to your employer or bank. Your IRS tax debt also benefits you in another fantastic manner. You may be able to maintain this IRS status for multiple years.
As just explained, IRS Uncollectible Status results in no payments of any amount to IRS for quite some time. However, an IRS Installment Agreement taxpayer must make monthly payments to the federal government. The amount of those payments is determined by a very precise calculation. Such monthly payments can last for five to eight years. Still, though, the monthly payment is often less than $100.
Types of IRS Installment Agreements that we can negotiate for you
There are three basic types of IRS Installment Agreements: guaranteed, streamlined, and non-streamlined. However, as you can see below, there are three different types of streamlined installment agreements, too. They are discussed in greater detail on their own web pages:
- Guaranteed Installment Agreement – for all individuals who owe IRS less than $10,000. Applies to individual Form 1040 taxes only. Does not apply to business or payroll taxes. Payment term cannot exceed 36 months.
- Streamlined Installment Agreement – for individuals who owe IRS between $10,000 and $25,000. Does not apply to business or payroll taxes unless the business has closed. Applies to Wage and Investment (W&I) taxpayers only. W&I taxpayers are defined by IRS as those individuals “that receive W-2 wages, who are employees, and who pay their taxes through withholdings generally fall within the profile that the IRS Wage and Investment Division is responsible for helping.” This group also includes individuals whose main source of income is dividends and interest and capital gains. No individuals whose main source of income is from self-employed business sources are included in this group. Payment term cannot exceed 72 months. A Notice of Federal Tax Lien can be avoided or released if previously filed.
- Streamlined Installment Agreement – for Small Business/Self-Employed (SB/SE) individuals only who owe IRS $25,000 – $50,000. Not for employees discussed above that IRS calls Wage & Income (W&I) accounts. Does not apply to business or payroll taxes unless the business has closed. Payment term cannot exceed 72 months. Collection Information Statement is not required. A Notice of Federal Tax Lien can be avoided if not previously filed. However, if a federal tax lien has already been filed it will not be released. Direct debit or payroll deduction is preferred but not required.
- Streamlined Installment Agreement – for Small Business/Self Employed (SB/SE) individuals who owe IRS $50,000 – $100,000. Also applies to all out of business sole-proprietorship debts between $50,000 and $100,000. Payment term cannot exceed 84 months. Collection Information Statement is not required if the taxpayer agrees to make payment by direct debit or payroll deduction. Direct debit payments or payroll deduction is not required; however, if one of these methods is not used, then a Collection Information Statement is required. A Federal Tax Lien will be filed if one has not yet been filed.
- Non-Streamlined Installment Agreement – for individuals who owe IRS over $100,000. Individuals who owe over $100,000 must negotiate their own individual payment plans with IRS. Payment terms will be tailored to suit the individual’s Collection Information Statement. Federal tax lien will be filed.
Methods of IRS Installment Agreement Payments
- Partial Payment Installment Agreement – Does not fully pay the entire tax liability within the Collection Statute of Limitations (generally ten years from tax assessment date). This payment method is reviewed every 24 to 30 months.
- Direct Debit Installment Agreement from bank account – Debits a bank account on the same day each month for the agreed-upon amount.
- Payroll Deduction Agreement from pay check – Serves as any other payroll deduction on a weekly, bi-weekly, semi-monthly, or monthly basis. The employer then remits the deducted funds to IRS each month.
- Payment by mail – Taxpayer mails a check, money order, or cashiers check to IRS on a monthly basis for an agreed-upon amount.
IRS Installment Agreement – How Do I Get Started?
Time is of the essence in these matters, so you will need to act quickly after receiving notice from the IRS regarding a tax debt. When you do, contact us as soon as possible so we can discuss your case and your options. We will provide you with a wealth of information whether you end up becoming a client or not.
We advise all of our clients looking for this service to download our IRS Levy Release Package to start the process.
Once you’ve completed the Client Information Sheets, fax/email us a copy so we can start the negotiations right away. We will discuss your financial situation with the IRS on your behalf and prove to them that you qualify for this option to pay off your tax debt.
Typically, we set up IRS Installment Agreements to begin payment 60 days from the date we make our agreement.
A call is made to you with the good news about your installment agreement once it has been negotiated. Details include the amount of your monthly payment and the date when your first payment is due. Without a doubt the monthly payments should be made on time until the balance is paid in full. If you desire an IRS Installment Agreement after we speak with you then we guarantee to get it for you. We are so confident of this ability that we back it up with a 100% Money Back Guarantee.
Our IRS Installment Agreement Fees
Our fee for negotiating an IRS Installment Agreement is $1,195.00. This is our fixed price despite the numerous hours it often takes us to research and finalize the agreement. If you decide to move forward with the process we require an initial 50% payment upfront by credit card. Upon finalization of the agreement the remaining balance is due. Credit card payments give you the ability to cancel the charge if we are unable to negotiate an installment agreement.