Having tax debt can be daunting and even overwhelming. You may think you do not have any options except the seizure of your assets. This is untrue. In most cases, if you do not qualify for an Offer in Compromise (OIC), you will qualify for one of the installment agreements the IRS has, no matter the size of your tax debt.
The IRS has a statute of limitations of ten years to collect a tax debt from you, so if it is within that time period, the IRS will negotiate a payment arrangement with you. And here’s a little-known fact: some IRS installment agreements won’t require you to pay back all of your debt. For larger tax debts, or if you cannot repay the debt within 60 months, you may need the help of a seasoned tax professional at our Chicago tax resolution firm. We can help get you set up in a repayment program so you will stop getting threatening letters from the IRS.
There are four types of payment plans offered by the IRS:
Streamlined installment agreements work with balances up to $50,000, while guaranteed agreements go up to $10,000. Even with these programs, a tax professional (attorney, CPA or EA) may be recommended if you cannot make the minimum payment that the IRS demands.
Note: the IRS and several states have experimented with Streamlined Installment Agreements for people with as high as $100,000 in assessed debt. These higher debt programs come and go, so taxpayers need to first check the availability and eligibility criteria.
In all Streamlined agreements, you may get some or all of your penalties and certain interest back if your petition for that is approved.
A partial installment agreement allows the taxpayer to pay less than the total amount of tax debt owed.These agreements are based on economic difficulties and require documentation to back up the taxpayer’s hardship claims. If you are having payment plan issues, this may be an option for you. With these types of arrangements, our Chicago tax relief firm will work with you to ensure that all the documentation is correct and negotiate an appropriate agreement with the IRS.
A discretionary installment agreement may work if you owe more than $50,000 but cannot repay it within 60 or 72 months. Our tax resolution firm in Chicago can negotiate an arrangement that is acceptable to both you and the IRS, allowing you to make lower monthly payments. A tax professional can help you make sure all financial claims are backed up and prepared for the IRS.
If you are having IRS payment plan issues, all is not lost. Whatever you do, do not just stop paying the IRS. The Tax Defenders has been working for 15 years helping people like you find a solution to their tax debt problems.