When you need more than the Simple Payment Plan
The Simple Payment Plan covers individuals who owe $50,000 or less. If you owe more, or can’t afford a payment that clears your balance in time, the IRS looks at your finances first.
What the IRS looks at
- Income from every source.
- Living expenses, compared with the IRS’s Collection Financial Standards: national standards for food, clothing and similar costs, and local standards for housing, utilities and transportation that vary by county and household size.
- Assets, such as bank accounts, vehicles, real estate and retirement accounts.
- The collection deadline for each year you owe, generally 10 years from assessment.
The difference between your income and your allowable expenses is roughly what the IRS expects you to pay each month.
Types of agreement
- Non-streamlined installment agreement: pays the full balance over time, based on your financial statement.
- Partial-payment installment agreement: monthly payments that won’t clear the balance before the collection period ends. The IRS reviews your finances periodically.
Things to know
- Interest keeps accruing until the balance is paid.
- The IRS may file a federal tax lien on larger balances.
- Every required return must be filed, and you must stay current on new taxes.
Where we come in
Building an accurate financial statement and matching it to the IRS’s standards is where an Enrolled Agent earns their fee. We build it from your bank data and documents, show you the math, and an Enrolled Agent submits it. See resolution services.