An Installment Agreement is a payment arrangement whereby the government allows you to pay tax liabilities over time (normally in monthly payments). Once a payment plan is established, the IRS will not take collection action, including the levy of bank accounts or wages, as long as you remain current with all other filing and payment obligations. However, interest and penalties will continue to accrue until the outstanding balance is paid. 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.
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 an arrangement for the lowest possible monthly payment and also provide you with various options for making those payments which include the Electronic Federal Tax Payment System, direct debit, payroll deduction, credit card, 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. Interest and penalties will continue to accrue. However, this option may provide you with an opportunity to wait for the collections statute to run and the liabilities to expire (10 years assuming no extending events).
