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Tax Controversy & Resolution: IRS Installment Plan (repayment) 

IRS Installment Plans

If you cannot pay your tax debt in full, the IRS may agree to let you pay it off gradually in monthly installments. However, the IRS does collect penalties and interest on past due amounts. By law, the IRS may assess penalties to taxpayers for both failing to file a tax return and for failing to pay taxes they owe by the deadline. 

If you're not able to pay the tax you owe by your original filing due date, the balance is subject to interest and a monthly late payment penalty. There's also a penalty for failure to file a tax return, so you should file timely even if you can't pay your balance in full. It's always in your best interest to pay in full as soon as you can to minimize the additional charges.

Not paying your taxes when they are due may cause the filing of a Notice of Federal Tax Lien and/or an IRS levy action. See IRS Publication 594, The IRS Collection Process and Important Facts about Filing Late and Paying Penalties

An installment agreement can be either formal or informal. In an informal installment agreement, the taxpayer promises to make monthly payments in an agreed amount which will pay off his balance within a particular time period. A formal installment agreement is a written agreement in which the taxpayer promises to make, and IRS agrees to accept, monthly payments in a specified amount.

If an IRS collection employee sets a taxpayer’s installment payment at an amount which may be too high, you may be able to adjust the monthly payments with the IRS collection team. If still unable to resolve the amount of installment payment reduction by talking with the IRS collection team, you may be able to request the matter to the IRS Appeals Office.

The IRS allows numerous ways for arranging to pay a delinquent tax liability. AndreTaxCo can help you set up a payment option that works for you, pays off the tax debt in the shortest amount of time, in order to keep the interest accumulation to a minimum.

Benefits of Entering IRS Installment Plans

  • Avoid accruing additional interest and penalties

  • Avoid offset of your future refunds

  • Avoid issues obtaining loans


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