Being a former IRS agent and teaching instructor there is a very specific way to negotiate a payment plan or settle your tax debt with the Internal Revenue Service.
We are comprised of tax attorneys, tax lawyers, certified public accountants, and former IRS agents and managers who have been negotiating payment plans and settling IRS tax debt since 1982.
We are A+ rated by the Better Business Bureau and have been in private practice since 1982. You can call us today for free initial tax consultation and you can speak directly to a true tax professional.
Negotiate a Payment Plan or Settle with the IRS,different types of Plans
In-Business Trust Fund Express Installment Agreements
Small businesses who currently have employees can qualify for an In-Business Trust Fund Express Installment Agreement (IBTF-Express IA).
These installment agreements generally do not require a financial statement or financial verification as part of the application process.
The criteria to qualify for an IBTF-Express IA are:
- You owe $25,000 or less at the time the agreement is established.
- If you owe more than $25,000, you may pay down the liability before entering into the agreement in order to qualify.
- The debt must be full paid within 24-months or prior to the Collection Statute Expiration Date (CSED), whichever is earlier.
- You must enroll in a Direct Debit installment agreement (DDIA) if the amount you owe is between $10,000 and $25,000.
- You must be compliant with all filing and payment requirements.
Streamlined Installment Agreements
The Fresh Start provisions also mean that more taxpayers will have the ability to use streamlined installment agreements to catch up on back taxes.
Under the Fresh Start initiative, the maximum dollar criteria for streamlined installment agreements has been raised from $25,000 to $50,000 and the maximum term has been raised from 60 months to 72 months.
These installment agreements generally do not require a financial statement, but a limited amount of financial information may be required in the application process.
The Streamlined Installment Agreement criteria is divided into two categories, balance due of $25,000 or less, and balance due $25,001 to $50,000.
The criteria to qualify for streamlined installment agreements with a balance due of $25,00 or less are:
- You owe $25,000 or less, at the time the agreement is established.
- If you owe more than $25,000, you may pay down the liability before entering into the agreement in order to qualify.
- The debt must be full paid within 72-months or prior to the Collection Statute Expiration Date, whichever is earlier.
- You must be compliant with all filing and payment requirements.
- Individuals who owe any type of tax (Form 1040, Trust Fund Recovery Penalty, etc.).
- Defunct businesses, including any type of entity and any type tax (Form 940, 941, 943, etc.).
- Operating businesses are limited to income tax liabilities only (Form 1120).
The criteria to qualify for streamlined installment agreements with a balance due of $25,001 to $50,000 are:
- You owe $25,001 to $50,000, at the time the agreement is established.
- If you owe more than $50,000, you may pay down the liability before entering into the agreement in order to qualify.
- The debt must be full paid within 72-months or prior to the Collection Statute Expiration Date, whichever is earlier.
- You must be compliant with all filing and payment requirements.
- Individuals who owe any type of tax (Form 1040, Trust Fund Recovery Penalty, etc.).
- Businesses are limited to defunct sole proprietors who owe any type of tax (Form 940, 941, 943, etc.).
- You must enroll in a Direct Debit Installment Agreement.
- A limited amount of financial information may be required during the application process.
- Taxpayers seeking installment agreements exceeding $50,000 will still need to supply the IRS with a Collection Information Statement (Form 433-A (PDF) or Form 433-F (PDF).
You can make monthly payments through an installment agreement if you’re not financially able to pay your tax debt immediately.
However, you will reduce or eliminate the amount of penalties and interest you pay and avoid the fee associated with setting up an installment agreement if you pay your tax bill in full.
Before you apply:
File all required tax returns;
Consider other sources (loan or credit card) to pay your tax debt in full to save money;
Determine the largest monthly payment you can make ($25 minimum); and
Know that your future refunds will be applied to your tax debt until it is paid in full.
Fees for setting up an installment agreement:
$52 for a direct debit agreement;
$105 for a standard agreement or payroll deduction agreement; or
$43 if your income is below a certain level.
Understand your agreement, avoid default
To keep your account in good standing:
Pay at least your minimum monthly payment when it’s due (direct debit or payroll deductions make this easy);
Include your name, address, SSN, daytime phone number, tax year and return type on your payment;
File all required tax returns on time;
Pay all taxes you owe in full and on time (contact us to change your existing agreement if you cannot);
Continue to make all scheduled payments even if we apply your refund to your account balance; and
Ensure your statement is sent to the correct address, contact us if you move or complete and mail Form 8822, Change of Address (PDF).
If you don’t receive your statement, send your payment to the address listed in your agreement.
There may be a reinstatement fee if your agreement goes into default. Penalties and interest continue to accrue until your balance is paid in full. If you are in danger of defaulting on your payment agreement for any reason, contact the IRS immediately.
The IRS will generally not take enforced collection actions:
When an installment agreement is being considered;
While an agreement is in effect;
For 30 days after a request is rejected, or
During the period the IRS evaluates an appeal of a rejected or terminated
You can make monthly payments through an installment agreement if you’re not financially able to pay your tax debt immediately.
However, you will reduce or eliminate the amount of penalties and interest you pay and avoid the fee associated with setting up an installment agreement if you pay your tax bill in full.
