An Installment Agreement is a payment arrangement whereby the government allows a taxpayer to pay liabilities over time. Once a payment plan is established, the IRS will not take enforced collection action, including the levy of bank accounts or wages, as long as the taxpayer remains current with all filing and payment obligations. However, interest and penalties would continue to accrue until the outstanding balance is satisfied. Additionally, a tax lien may be filed as part of the terms of the installment payment agreement, depending on the amount of the total liability.

* If you owe $10,000 or under, and all your returns are filed, and you have not been in trouble with the IRS before, generally, the IRS guarantees to place you in a payment plan as long as you can full pay the amortized balance in 36 months. The taxpayer can probably accomplish this themselves without representation.

** If you owe between $10,001 and $24,999, and all your returns are filed, the IRS will negotiate what they consider a “streamline” payment plan. They will negotiate this requiring the minimum amount of financial disclosure by the taxpayer by having the taxpayer complete a 433-F (small case Collection Information Statement)

*** if you owe between $25,000 and $100,000, and all your returns are filed, you are considered in the “Big Leagues” and you WILL require representation. The IRS will demand full financial disclosure via completing a Collection Information Statement called a 433-A. They will most likely ask for supporting documentation like bank statements, pay stubs and cancelled checks to validate or prove your income and expenses.

**** if you owe over $100,000, your case will be forwarded to the “large Dollar Unit”. This is a nationally centralized special unit of the IRS that only deals with payment plans involving liabilities over $100,000. This is the IRS’s most intrusive Collection division. They are brutal here. If you wish to go it alone, without expert representation, you WILL get “creamed”. For example, for they will even entertain negotiating a payment plan, they will require you to exhaust all efforts to liquidate your assets including your home. We deal with this unit every day of the week. We know how to navigate the maze, protocols, laws, etc. so you don’t have to lose your home or other assets, but you MUST take the first step and CALL NOW 1-866-IRS-PROBLEMS.

Whether the IRS is demanding full payment up-front or a payment plan that is substantially higher than what you can afford to pay, we can negotiate to set up an arrangement for the lowest possible monthly payment and also provide you with various options for making those payments, including via the Electronic Federal Tax Payment System, direct debit, payroll deduction, credit card, and payment by check or money order. Since the government will not agree to an installment agreement until all necessary tax returns are filed, we can also prepare and file any and all returns to bring you into compliance before arranging a payment plan.

If you cannot afford to make monthly payments and do not qualify for another type of tax relief, such as an offer in compromise, we will negotiate to have your account placed in a "currently not collectible" status. By doing so, you will not be required to make any payments and the IRS will not pursue collection action. This option may provide you with an opportunity to wait for the collections statute to run and the liabilities to expire.

For more information on installment agreements, please call us for a free, confidential consultation. If you are searching for a highly qualified representative to negotiate on your behalf with the IRS or a state tax agency, we offer our services with the highest levels of quality and professionalism. Through our team of expert tax attorneys, enrolled agents, and CPA's, we will negotiate to setup the lowest possible payment plan or defer collections based on a financial hardship. Whether you owe millions of dollars or only several thousand, we can help you reach a resolution on your back taxes and obtain a fresh start towards financial freedom.

Read our blog articles about IRS Payment Plans:
Tax Problem FAQ: What is an IRS Installment Agreement?
Offer in Compromise & Installment Agreement
If I am not eligible for the Offer in Compromise program, can I enroll an Installment Agreement?