When it comes time to pay your tax bill, you have options if you owe more than you can reasonably pay. One popular IRS tax relief solution is an IRS installment plan. This allows you to pay down your tax debt with reasonable and affordable payments over a period of time. The terms typically include interest and penalties; however, it provides an avenue for getting yourself back on track that finally eliminates your burden.
The installment agreement is a program that works just as you would expect. The IRS and you negotiate a tax relief settlement that allows you to pay off your debt in affordable chunks over a period of time, rather than in one large payment. The terms can range from four months to ten years, depending on your tax liability. There are a few types of IRS installment agreements: streamline, long-term, protracted, and partial payment.
A streamlined installment agreement is typically for those who owe less than $25,000 in taxes, including any interest, fines, penalties, or other fees. Because the amount is lower, it is easier to negotiate a payment plan. Additionally, you do not have to provide any financial information to the IRS. The terms for this type of plan typically last about 60 months or 5 years. You can also negotiate a similar 5-year IRS payment plan if you owe more than $25,000; however, you will have to provide your income and other financial information. It also is not streamlined, since the amount makes it a more complicated application procedure.
Protracted installment agreements also come with a 5-year term, but they include an extension of the statute of limitations for collections. A long-term installment agreement lasts longer than the standard 60-month term and is dependent upon your tax liability and ability to pay.
The partial payment installment involves a more complicated installment agreement application process. This option is for those who owe a significant amount of money and will be unable to ever afford to pay the entire amount. In this agreement, the taxpayer also pays monthly payments to the IRS. The difference lies in the conclusion of the payment terms. At the end of the terms, the person will not have paid off the entire debt. Instead, the debt is forgiven, as long as the person has maintained good standing during the repayment term. Complete and accurate financial information is necessary for approval of this type of installment agreement. It is also a long and complex application process; therefore, the help of tax professionals can ensure that you get the negotiated terms you want and need.
There are many benefits to this tax relief program. First and foremost, it will prevent and stop any wage garnishment, tax levy, liens, or other action by the IRS. You can create installment payments based upon what you can realistically afford; therefore, your quality of life does not have to be negatively affected by your tax debt. You also have the opportunity to have some of your debt forgiven if you qualify for the partial payment installment agreement.
Although you can find the IRS installment agreement forms and fill them out yourself, you benefit from utilizing the experience and knowledgeable tax professionals at Fidelity Tax Relief. First, filling out the forms can be a complicated procedure. If you make any mistake, your application will be denied. You are also required to submit proof, including detailed financial statements. Our staff will ensure that the IRS receives all the forms, financial statements, and other information that demonstrates your ability to pay only a certain amount per month. Furthermore, we act on your behalf with the IRS, removing the stress and burden with which you have been living.
Our tax consultants are ready to discuss the Installment Agreement and other IRS tax relief services that can help you eliminate your debt.