Installment Agreements

Installment Agreement
(Monthly Payment Plan)

IRS and State Tax Resolution

An Installment Agreement is a monthly payment plan that pays off your tax, penalties, and interest owed to the IRS. The good news is that once an installment agreement is established, the IRS is required by law to stop enforced collection activities like bank account levies and wage garnishments. As long as you stay current with your monthly payments, the IRS is prohibited from going back to collections on tax periods covered by the agreement.

Establishing an Installment Agrement with the IRS

But, if establishing an Installment agreement was as simple as making a quick call to the IRS, offering a payment amount, and having it accepted, we’d be out of work.  The fact is the IRS has multiple types of Installment Agreements that depend on 1) the total balance due in comparison to certain thresholds and 2) your current income and expense levels.

How Installment Agreements are Calculated

If you owe more than the Streamlined threshold, you’ll need to fill out a collection statement (Form 433A or 433F) listing your monthly income and expenses. Your actual expenses will differ from the IRS allowable standards, which are based on your county of residence and the amount of people living in your home. The IRS will calculate your ability to pay based on their pre-set allowable standards, not your actual expenses. This can lead to a monthly payment amount more than you can afford.

We will review your income and expenses, anticipate the adjustments made by the IRS prior to submitting your information, and plan accordingly to establish an affordable plan.

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