Installment Agreement

Installment Agreement

Installment Agreements or payment plans are payment arrangements the IRS allows taxpayers to pay liabilities over time.  If you cannot pay your total liability by the end of the collection statute expiration date but may be able to pay a portion of the tax, you may be able to enter in to a partial payment installment agreement.  Integrity Tax Resolution will negotiate the lowest possible payment plan for your circumstances.

Understand that while the installment agreement is in place penalty and interest continue to accrue.

What can an installment agreement do for you?

• No collection activity can be taken while you have a pending installment agreement.
• Levies may be released while an installment agreement is pending.
• In general Levies must be released when an installment agreement is approved.
• You are protected from collection activities 30 days after a rejection for approval.
• If you default or the installment agreement is terminated you have another 30 days to appeal.
• You can appeal a terminated, defaulted, or rejection of an installment agreement.  No collection activity can be taken while in appeal.
• Installment agreements may allow you to affordably pay down your liability with out putting you in economic hardship.

Careful Financial Review
 

In many circumstances when an outstanding balance is owed above $25,000 a collection information statement will be reviewed by the IRS before they will approve an installment agreement.

Careful planning and strategy is needed in order to negotiate the best possible payment plan without the taxpayer having to leverage assets or pay a large lump sum.

If you think you are in this category contact Integrity Tax Resolution today.

What type of Installment Agreement is for you?

Guaranteed or Streamlined agreements may be great for your circumstances because they are processed quickly and there is no need for financial analysis.

Guaranteed Agreements

The IRS is required to accept proposals of installment agreements under certain circumstances.

• Owe income tax of $10,000 or less.
• Filed and paid all tax returns during the five years prior to the year of the liability.
• Cannot pay the tax immediately.
• Agree to fully pay the tax liability within 3 years.
• Have not had installment agreement during the prior five-year period.

Streamlined Installment Agreements

Streamlined Agreements may be approved for taxpayers under the following circumstances.

• The unpaid balance of assessments is $25,000 or less.  The balance does not include accrued penalty and interest.
• The unpaid balance of assessments must be fully paid in 60 months or the agreement will be fully paid prior to the collection statue expiration date, which ever comes first.

After a careful financial review and assessment of tax liability, in the right circumstances an Integrity Tax Resolution representatives might conclude an appropriate strategy may be to pay the assessed balance under the $25,000 threshold in order to qualify for the streamlined program. 

What that does for individuals with assets and income is to allow them a payment plan they can afford without paying the total balance due because they have the assets to do so.  The total balance due is likely above $25,000 when you include penalty and interest.  Only the assessed balance must be under the $25,000 threshold. The key to this strategy is to be sure no financial information is submitted to the IRS, but that the taxpayer will qualify for the streamlined agreement.

Integrity Tax Resolution will help you negotiate the lowest possible payment arrangement after careful planning and review.  We look forward to hearing from you.