Installment Agreement

The Internal Revenue Service has several new features added to the interactive Online Payment Agreement application found on the IRS website. These features are designed to make it easier for taxpayers to make changes to existing installment agreements and apply for a new one. The system now permits individuals to revise their payment due dates and/or amounts on existing agreements, to revise existing extensions to regular installment agreements, and to revise existing regular installment agreements to a payroll deduction installment agreement or a direct debit installment agreement.

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Taxpayers who owe but can't pay in full have several options available to help them meet their tax obligations and save money by the April 15 filing deadline. First, taxpayers should file their return on time and pay as much as they can with their return. Second, a taxpayer should request a installment payment agreement for the balance. Interest and penalties can add up for taxpayers that don't file and pay on time. Taxpayers can limit these charges by simply filing on time and paying at least some of the balance owed. Interest and penalties will apply to any tax paid after the April 15 deadline, but are based on the balance owed, therefore paying some and owing less will reduce the interest and penalties associated with not paying in full. Additionally, just by filing on time (even if a balance is owed) a taxpayer avoids the much larger 5-percent-per-month late-filing penalty.

More on Payment Options for Taxpayers Who Can’t Pay in Full

I prepared this short video on IRS Payment Plans also known as IRS Installment Agreements. I explain in detail how do you qualify and how do you get the IRS to agree to one. It's sometimes very easy and at times excruciatingly difficult. If you want to know more about the different solutions available to people with IRS Problems, you might want to visit our IRS Solutions page or call our office tollfree at (888) 438-6474. We represent clients all across the U.S. and the world.

More on IRS Payment Plans – Do you qualify? and How do you get one?