IRS Installment Agreements

An Installment Agreement is a payment arrangement in which the IRS permits a taxpayer to pay delinquent tax liabilities over time. Once an Installment Agreement is established, the IRS will refrain from engaging in enforced collection action, including the levy of bank accounts or wages, while the taxpayer remains current with all future tax filing and payment obligations. However, interest and penalties continue to accrue on the outstanding balance of the tax liability until the liability is paid in full. Although the IRS will refrain from levy action against bank accounts and wages, or seizing taxpayer property, the IRS may file a federal tax lien to secure compliance with the installment payment arrangement. The IRS views a tax lien as a “passive” collection device because it does not cause the immediate seizure of taxpayer property, but merely acts to secure taxpayer compliance with the installment agreement payment arrangement.

Negotiation of an Installment Agreement within the taxpayer’s ability to perform is often difficult and requires substantial knowledge about IRS guidelines and regulations. Determination of the minimum monthly installment payment that will be acceptable to the government depends upon the application of specific IRS income and expense standards to the specific facts of the case. These regulations and guidelines include IRS local and national standards for allowable expenses that IRS Revenue Officers will use to evaluate your installment offer and proposed payment amount. If the IRS is demanding immediate full payment or a payment plan that is substantially higher than you can afford to pay, please consider calling me for help. I have substantial experience helping taxpayers negotiate the lowest possible monthly payment with the IRS. I also often work with state taxing authorities to negotiate payment plans for my clients’ state tax liabilities.

In order to submit an installment agreement, the IRS requires that a taxpayer file all delinquent returns and remain current on future filing obligations. Your installment agreement offer will not be considered or accepted until you have satisfied that requirement. If you have outstanding tax returns, we can prepare and file all returns necessary to bring you into compliance with your tax return filing obligations and enable you to qualify to submit an installment agreement proposal or other collection alternative.

If you cannot afford to make monthly payments and do not qualify for another type of tax relief, such as an Offer in Compromise, I can help you request that the IRS place your account in a “currently not collectible” status. Once an account is classified as “currently not collectible” by the IRS, it will discontinue enforcement action and release any levies already in place. In many instances, the IRS will keep an account in currently not collectible status for a substantial period of time. In some cases, I have even seen accounts kept in uncollectible status until the collections statute of limitations has expired. For more information concerning IRS or state installment agreements, please call me for a confidential consultation.

If you are searching for a highly qualified representative to negotiate on your behalf with the IRS or a state agency, please consider contacting me at The Gaymon Law Firm, PLLC, for help.  I will negotiate on your behalf to create the lowest possible payment plan, or even defer collections activity by the IRS or state in appropriate situations. Contact me at The Gaymon Law Firm, PLLC, telephone (703) 407-9130, or by completing the Contact Form contained on this Web site.