Tax Relief FAQ: What Is An IRS Installment Agreement for Payment of Back Taxes?

Thousands of Americans owe back taxes and interest to the IRS every year. If you are one of the many taxpayers feeling the burden of tax debt, it’s important to take the necessary steps to resolve your IRS problems now – and not later. The worst thing you can do is ignore letters from the IRS in hope that your troubles will go away. They will not, unless you take the appropriate steps!

If you have back taxes to settle, it’s important to know what options are available to you for dealing with the IRS – so you can get the income tax relief you need. If you are unable to pay off back taxes in full, you may qualify for tax relief by negotiating an IRS Payment Plan, more commonly known as an Installment Agreement (IA).

An Installment Agreement allows taxpayers to pay off tax debt with a series of regular monthly payments, usually within a statutory five-year timeframe. Once an Installment Agreement is established, the IRS will cease all collection actions, including garnishment of wages. However, the IRS charges a user fee to set up the plan, and back taxes are still subject to interest and penalties, although the future penalties are cut by 50%!

The IRS may also file a Notice of Federal Tax Lien until the final payment is made. If the amount the taxpayer can afford to pay monthly does not satisfy the debt owed (including interest and penalties), another tax relief option, such as a Partial Pay Installment Agreement or an Offer in Compromise, may be a better choice. For that reason, a taxpayer owing back taxes should seek tax help from a tax attorney or Certified Tax Resolution Specialist.

Tax relief experts can help negotiate the lowest, most affordable schedule of payments and the best method for making the payments, including direct debit, payroll deduction, credit card, and in-person payment by check or money order. A tax attorney or Certified Tax Resolution Specialist will also be able to prepare and file any delinquent tax returns since the IRS will not enter into a payment plan until the taxpayer’s paperwork is fully in compliance.

While an Installment Agreement is a manageable tax relief option, be aware that all payments must be timely. Late payments can terminate the agreement, in which case the IRS may file a Notice of Federal Tax Lien and/or Levy, which will adversely affect a taxpayer’s credit rating.

Additional Information for Tax Relief:

Settling Back Taxes and IRS Problems
Get expert tax help resolving your tax debt for a fraction of what you owe to permanently settle your back taxes and IRS problems.

Tax Relief Glossary
Tax help glossary with common income tax relief terms to help you settle your IRS debt and permanently achieve your tax resolution.

IRS Tax Help Articles
Helpful articles for resolving IRS debt with IRS tax relief options like offer in compromise, IRS payment plans, and IRS audit resolution.

Tax Resolution University Blog
Expert tax relief resource to help you permanently resolve all back taxes and IRS problems.

For more answers to your tax relief questions, check out our Tax Relief FAQs page.

If you have IRS problems, you can consult tax help from a tax attorney, CPA, or Certified Tax Resolution Specialist. Tax Resolution Services is a dedicated team of tax experts who are here to help you. Call our office today at 1-866-IRS-PROBLEMS or visit www.taxresolution.com for a free tax relief consultation.

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