Installment Agreement

An installment agreement is the IRS’s payment plan program. There are several different types of installment agreements available depending on your financial situation and the total amount of debt owed.

Installment agreements are probably the most underrated resolution that the IRS offers. People hear the phrase “payment plan” and instantly recoil. Yes, an installment agreement is an arrangement to make payments on your tax debt over an extended period of time, usually six to seven years. And yes, penalties and interest continue to accrue during that time. However, the IRS offers an incredible amount of flexibility when it comes to these plans. They have plans with tiered payments if you are going through a temporary hardship. They offer income-based plans if you cannot afford a standard payment. And on the other end of the spectrum, they offer streamlined agreements for those who do not want the IRS poking around in their finances.

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Installment agreement Papers

All that being said, the common fear is still about the amount of time that you’re committing to making payments. It is important to note though that installment agreements are not necessarily fixed. If at any point your circumstances change you can renegotiate your agreement. As long as the IRS is receiving payments of some kind, they are generally happy, and more importantly, they consider you compliant. That means you are not at risk for any adverse collection activity like wage, accounts receivable, or bank levies.

Also, contrary to most beliefs, there is an expiration to every tax debt, so you will not be stuck making payments until the end of time. Eventually, the IRS has to write off any remaining balance as a bad debt.

An installment agreement can be an incredibly useful tool to solving your past due taxes. Schedule your free consultation today to find out how we can put one to use for you.

Flexible Agreements for Any Situation

Streamlined Installment Agreement

For Balances Below $100k

Does Not Require Financial Statement with Direct Debit Agreement

Six- to Seven-Year Term

Can Avoid Federal Tax Liens if Balance is Below $50k

Partial Pay Installment Agreement

For Balances Below $100k

Requires Financial Statement

Payments until Statute of Limitations Expire

Federal Tax Liens will be Filed

Standard Installment Agreement

For Balances Over $100k

Requires Financial Statement

Payments until Paid in Full or Statute of Limitations Expire

Federal Tax Liens will be Filed

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