There are two types of simplified installment agreements, depending on how much you owe and for what type of tax. For both types, you must pay the debt in full within 72 months (six years) and within the deadline for the IRS to collect the tax, but you won't need to file a financial statement. The good thing about an IRS payment plan is that the IRS has 10 years to collect a tax debt from you. This means that your payment plan will eventually end, to your benefit.
Or, ask a tax professional to determine which payment agreement may be best for you and even establish an agreement with the IRS for you. The Office of Management and Budget has directed federal agencies to charge users fees for services such as the installment agreement program. This can lower your balance and make paying the monthly installment agreement more manageable. You can quickly set up simple payment plans, such as payment extensions and “simplified installment agreements”.
Pay by direct debit (automatic monthly payments from your checking account), also known as an installment direct debit agreement (DDIA). If there's simply no way you can settle your balance with the CSED, you can negotiate a partial installment payment agreement. Get information from H&R Block about the four types of IRS penalty relief and which IRS penalty relief option may be best for your situation. Everything is quiet between you and the IRS: you have a payment plan and the IRS won't knock on your door because your account is in the process of being resolved.
Applicants must submit the form to the IRS within 30 days from the date of their letter of acceptance of the installment agreement to ask the IRS to reconsider their status. If the IRS system identifies you as a low-income taxpayer, the online payment agreement tool will automatically reflect the applicable rate. If you are a low-income taxpayer but are unable to make electronic debit payments when you sign up for a DDIA, your user fee will be refunded once you complete the installment agreement. If your inability to make payments is longer-term, it's best to call before the IRS collection machinery goes live with letters of agreement that payment in unfulfilled installments will better protect your salaries, accounts and assets from IRS collection actions.
If you're not eligible for a payment plan through the online payment agreement tool, you may still be able to pay in installments. How long it all takes depends on your situation, the type of agreement you need, and how you need to interact with the IRS. When you apply for a payment plan (installment agreement), with certain exceptions, the IRS is generally prohibited from collecting taxes and the IRS's time to collect is suspended or extended while an installment agreement (IA) is pending. Contact The Gartzman Law Firm to speak with an Atlanta installment contract lawyer about your case.
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