INSTALLMENT AGREEMENT

What is an Installment Agreement

If you are unable to pay the taxes you owe in full as a lump sum, the IRS will typically allow you to enter into an installment agreement. An installment agreement is an agreement between you and the IRS to pay your taxes over an extended time and will generally keep the IRS from filing a Federal Tax Lien, garnishing your wages, or levying your bank account. 

Qualifying for an Installment Agreement

Before considering an installment agreement, the IRS will require that you be in tax compliance - meaning that all of your required tax returns are filed and you must be current on your estimated payments and/or have the proper withholdings.

Next, if you are a client of ours, we will prepare the proper paperwork to submit to the IRS on your behalf and if necessary negotiate the terms of the agreement to suit your needs.​

The Long Term Payment Plan

If you are unable to pay your balance due within 120 days, a long term payment plan will be established, where you will pay down your tax debt over time in monthly installments. For individuals, the setup charge is between $31 and $149 (can be waived for low-income taxpayers) and you will be able to make your payments via:

  • Check, money order, or debit/credit card

  • Electronically through the Electronic Federal Tax Payment System (EFTPS), or

  • Direct draft from your checking or savings account.

It is important to note that penalties and interest will continue to accrue while on a long term installment agreement. ​

The Short Term Payment Plan

Under this payment option, the IRS will allow you to pay your balance due within 120 days or less. For individuals, there is no setup charge and you will be able to make your payments via:

  • Check, money order, or debit/credit card

  • Electronically through the Electronic Federal Tax Payment System (EFTPS), or

  • Direct draft from your checking or savings account.

Do Not Default on an Installment Agreement

Once your installment agreement has been established, it is important to not default on your agreement. To keep your installment plan in good standing, you will need to, among other things:

  • Stay current and not miss your monthly payments,

  • Remain in tax compliance by filing your tax returns, making your estimated quarterly payments, or being sure your withholdings are correct with your employer. 

​If your plan goes into default, the IRS may impose a reinstatement fee.

Getting Started

Depending on the amount you owe, preparing the documentation for an installment agreement can be a lengthy and technical exercise. We are experts at preparing the documentation required and can quickly get your payment plan established. 

To schedule a Free, no-obligation, consultation call us at 833-StopIRS.

Need more details? Contact us

We are here to assist you with your tax problems and can provide you with immediate relief! Contact us by phone at 833-STOPIRS or request a Free Consultation.