Facing Problems With Tax Debt? Consider IRS Installment Agreement

Considering IRS Installment Agreement for Tax Relief

December 18, 2023
admin
Blog
0

If, like many Americans, you also owe back taxes and are not able to pay despite your best efforts, what should you do? The answer lies in many of the provisions offered by the IRS to help taxpayers who are unable to fulfill their tax liabilities. One such provision is IRS Tax Installment Agreement, a monthly payment plan to help you pay off your tax liability in easy monthly installments.

The IRS offers installment payment plans to taxpayers whose tax bill is too hefty for a single payment. Under this plan, taxpayers can spread their payments over several months to make the bill more manageable. If individuals don’t pay such installments on time, the IRS may seize their property, place liens against their assets, and even garnish their wages. After approving an IRS tax installment or payment plan, the IRS will charge the taxpayer some extra fees. Taxpayers who qualify for a short-term payment plan are not required to pay such a fee.

Types Of IRS Tax Installment Agreement To Pay Your Tax Debt

Let’s look at five types of IRS installment agreement plans that are available to taxpayers with outstanding IRS debt. Read on!

1. Guaranteed Installment Agreement

A guaranteed installment plan is designed for taxpayers who owe the IRS up to $10,000 in taxes. To qualify for this plan, taxpayers should meet the following criteria:

Filed all tax returns in the past
Must have paid all the previous returns up to five years on time.
Must not have used any other installment agreement within the last five years.
Must be able to pay the total debt within three years.

Taxpayers who meet all these criteria can apply for this IRS installment agreement online. They are not required to provide a full financial statement to the government.

2. Streamlined Installment Agreement

A streamlined installment agreement is designed for taxpayers with debts of up to $50,000. Taxpayers can easily qualify for the IRS payment agreement and extend their payments for up to 72 months or six years. Like the Guaranteed Installment Agreement, taxpayers are not expected to provide a full financial statement to the IRS.

3. Payment Agreement for Debts Over $50,000

This settlement plan is for taxpayers who owe more than $50,000 to the IRS and do not easily qualify for the streamlined and guaranteed IRS payment agreements. The IRS thoroughly reviews the financial situation of such taxpayers to make sure they pay the debt off as early as possible. It will also demand that taxpayers furnish it with a financial statement. To avail this plan, it is recommended to get help from a tax professional as they can make sure that the IRS gets all the required financial information and also fill out a Collection Information Statement (Form 433-F or Form 433-A).

4. Partial Payment Installment Agreement

In situations when the outstanding tax amount is hefty and is not affordable, taxpayers may qualify for a partial payment installment agreement. The agreement allows taxpayers to take more time to repay the debt. The IRS will evaluate the financial position of the taxpayer including their equity in assets every two years to check if they are better off. In some cases, taxpayers may even have to sell their property to pay off their tax debt.

Offer in Compromise

The IRS may allow taxpayers who can’t afford their tax installments, even in partial payment installment agreement, to pay less than what they owe under an offer in compromise. To qualify for an OIC, taxpayers must have filed all their past tax returns, made all the necessary tax payments for the current year, and made all federal tax deposits for the current quarter.

Answering 5 FAQs About IRS Tax Installment Agreement

A lot of the taxpayers experiencing IRS tax debt problems consider the installment settlement agreements a relief, but there is a lot of confusion about the program. In this section, we answer five commonly asked questions about IRS Tax Installment Agreement. Read on.

1. Which IRS Installment Agreement Plan Is Right for Me?

There are four types of Installment Agreements. The following gives you a brief idea on your eligibility:

Guaranteed Installment Agreement: Apply for this three-year IA if you owe less than $10,000.
Streamlined Installment Agreement: If you owe $50,000 or less, this may be the path for you, and you can pay off your liability in 72 months or less.
Non-streamlined Installment Agreement: If you owe more than $50,000 and need a five-year payment plan, this is the right option for you.
Partial Pay Agreement: If your total tax debt is more than $10,000, and you are able to make a partial payment, this is the way out.

With the assistance of law experts at The Law Offices of Nick Nemeth, you can assess the most suitable Installment Agreement option for you.

2. Can the IRS levy a property while an Installment Agreement is in place?

The answer is no. The IRS does not levy your property, bank account, or wages if you are in an Installment Agreement.

3. What happens if I miss an IRS Installment Agreement payment?

In case you fail to make payment of your Installment Agreement, you will get Notice CP 523 from IRS mentioning that IRS plans to terminate your agreement and levy your property. This notice may adversely affect your credit score and may cause other financial issues. The best option is to inform the IRS by calling them directly.

4. What are the accepted methods to pay the installments?

Your Installment Agreements for paying federal tax debts can be settled using the following payment modes:

Credit cards
Money orders or checks
Direct bank account transfer
Debit from your work paycheck
Electronic Federal Tax Payment System (EFTPS)

5. Can the IRS put a tax lien on me if I am in an Installment Agreement?

Yes, the IRS can put a tax lien on your assets while you are in an Installment Agreement to secure themselves against other creditors who take an interest in your property. The total outstanding balance is the deciding factor.

6. Why would the IRS cancel my existing Installment Agreement?

The IRS can do so in the following scenarios:

You missed a payment.
You did not file for subsequent returns.
Your total tax liability increased since you started your Installment Agreement.
Your Collection Information Statement (Form 433A or 433F) was incomplete or incorrect.

Wrap Up

It is important to know that the IRS can revoke any installment arrangement if a taxpayer misses a payment, does not file a tax return, or provides inaccurate information on Form 433-F. While it is easy to qualify for an IRS installment agreement if you owe less than $50,000 to the government. To apply for agreements for debts over $50,000, it is recommended to seek assistance from a tax attorney who can help you to successfully apply for the settlement plan and get a proper tax problem resolution. To discuss the best IRS installment agreement for you in Dallas, Texas, simply call the Law Offices of Nick Nemeth at (972-426-2991 or fill out the form fill on our website to schedule a free, no obligation, and confidential consultation with Nick and his team.

Please follow and like us:

Brent Vahle

19:13 02 May 24

I called to see if they could help reduce some penalties and fees. The person I spoke with told me it might be counterproductive for them to take my case since their feels would likely equal the amount of penalty/interest abatement. I decided to pass on moving forward but was so happy to hear a legal team, or any business for that matter, who has that much integrity. I feel most others would likely try to take my money anyway. I hope I never have to go through this again, but if I do, I will definitely use the Law Offices of Nick Nemeth!

Jason Winkle

18:44 02 May 24

Jaime Flores was very friendly, professional, and knowledgeable. She gave me some very valuable information which helped guide me with a plan of action. The free consultation is very much appreciated.

Matthew Swigart

12:14 02 May 24

Great attorney who was able to provide quick and useful advice. Although my situation did not warrant their services, they still took the time to discuss solutions I could explore. I highly recommend visiting this office!

Tony Pantoja

12:57 09 Apr 24

Very professional and very knowledgeable, Jamie Flores was very straight forward and professional, a firm that doesn’t just take your money, Thanks

Carla Atwal

10:52 02 Apr 24

Nick was wonderful in guiding me with direction on some tax questions I had. He was concise, and to the point, and was happy to provide general info to me at no charge. I truly appreciate him and would highly recommend him.

Miguel Alvarado

15:56 25 Mar 24

By far the best attorneys I have ever worked with. They’re are very helpful and supportive from day one. They went above and beyond to make sure all my documents were submitted on time and gave updates as soon as they received them. I cannot name a single flaw in their work. Their team of assistants are very professional and seem to all be on the same page. I’ve made multiple phone calls and sent a ton of emails to their staff and they were able to help me all through the course of the case. I cannot express my gratitude enough for how excellent they handled my case.

Lucy Foy

06:55 19 Jan 24

My first appointment I had with, Tax Attorney Nick Nemeth, gave me such a sense of relief. He listened and gave me his professional advice, Mr Nemeth took my case. I was well kept updated, by phone calls and letters. That really impressed me and gave me so much confidence in them. The case went on for a couple of months. The day I received the call from one of his team members Kyle, informing me that the case was resolved and that I owed absolutely nothing to the IRS, I was overwhelmed with joy. I would recommend this law firm to anyone that needs help, with any tax issue. Thank you, to the Law Firm of Attorney Nick Nemeth and his team.

Bradley Runyon

20:17 13 Jan 24

I received a tax bill in the mail from the IRS last year in 2023. The fees and penalties I owed were something I myself could not afford. I reached out to Nick Nemeth's firm and received the best experience you could imagine. The team was professional, educational, and fast. If you have a tax issue with the IRS using another firm other than Nick Nemeth's would be an error in judgment. I would recommend their services above others.

Sue Hulseman

19:55 11 Jan 24

Working with Nick Nemeth and his team to resolve my debt with the IRS was the best decision I could have made. I felt such relief knowing I didn’t have to deal with the IRS myself. They did a wonderful job and were responsive to my questions and kept me abreast of my case. My outcome was exactly what I was hoping for. I strongly recommend using them if you have an issue to resolve with the IRS.

R G

20:53 21 Dec 23

I had an incompetent tax preparer, who also ignored several notices from the IRS, which in the end resulted in a lien on my property. I did not know what to do and an attorney friend recommended that I contact the Nick Nemeth Law Offices. I met with Jamie Flores and Ivan Nalbantov in December 2021 for a free consultation, and right away was impressed by their thorough examination of my paperwork and extensive knowledge of IRS tax laws. I felt not pressured and appreciated their advice and in the end decided that I would pursue resolving the issue by myself. I paid the IRS Civil Penalty and, as recommended also submitted a letter to the IRS requesting a refund and explaining what happened. I am glad to report that my persistence finally paid off. My case took two years to resolve and I finally received a full abatement/refund check from the IRS in December 2023. I could not have done this without the straightforward recommendation of Jamie and Ivan; and I highly recommend the Nick Nemeth Law Offices to anyone needing help with the IRS.

Susan Wilson

03:27 25 Jan 23

I have been very pleased with the solid counsel and guidance that Nick Nemeth has provided me regarding my tax issue. I found him to be honest and straightforward which I appreciated. I was impressed with his relevant experience and knowledge . He has definitely brought me peace of mind during a difficult and stressful time.

Sarah Howard

03:44 14 Nov 22

I would like to thank Mr. Nick and his staff for the superb help that I received from them. My IRS problem was resolved quickly and efficiently. It took 2 visits to convince me that I was over my head. I thought that I could call the IRS, appeal my tax notices and settle on a payment plan on my own. After many phone calls to the IRS, waiting sometimes more than 4 hours with no resolution to speak of, it proved to be extremely difficult and stressful. Revisiting Mr. Nick was a huge wake up call. My account was reviewed, and a payment plan was established with the IRS within a week. I will be forever grateful to the staff who worked on my case and especially to Lorna who listened to me vent while going through this painful process.

M W

00:33 07 Aug 22

I cannot say enough good things about Nick and his team. When I first met with Nick he was up front, honest, friendly and efficient. When I worked with one of his attorneys, Eric B, I was just as pleased. All of the staff there are nice and very helpful. I wish I hadn't waited so long to get help with my issue. Over 6yrs I tried getting through and getting anywhere with the IRS and hardly made any progress. I know this may not be the case for all, and even I thought it would take longer than it did, but 3mos and they had my situation straightened out. I still can't believe it. Thank you thank you THANK YOU for all that you did for me. This is a huge burden gone out of my life now thanks to you. If anyone needs help out there, I know you may not want to shell out more money to get their help but it may just save you in the long run.

Spoilly Girl

23:49 03 Aug 22

The Nemeth Law team is exceptional. They treat their clients like a family member who is in crisis. They want you to get the best possible outcome. I really appreciate everything that they did for me. Jake and Ashley had the greatest role in my case and it all turned out for the best for me. Thank you Nick and team for easing my fears and getting me through the long process. I'm truly grateful.

Eddie Walt

19:44 12 Jul 22

During a time in which competent, professional service at a fair price seems to have disappeared, Mr. Nemeth and his team are a refreshing breath of fresh air.From my first phone call to the final settlement of our case with a non-responsive IRS, they under-promised, over-delivered and were in constant courteous contact to make sure we knew exactly what was happening and where we stood.I hope to never need their services again, but, should I receive another friendly letter from the IRS...I know who to call!