Landmark Tax Group

Payment Plan Tax Relief in Orange


What to Know About Installment Agreement Relief in Orange

What is an IRS payment plan? A monthly payment plan is a contract between a taxpayer and the IRS to pay down a tax liability over a period of time. Depending on the circumstances of a taxpayer’s case, IRS payment plans can last anywhere from three months to 72 months (6 years).

How do I get an IRS installment agreement?

Before the IRS can entertain a request for an installment agreement, taxpayers are required to be current with their federal tax withholding and filing obligations. Similarly, self-employed taxpayers need to be in compliance with estimated tax payments and filing for an opportunity to qualify. The IRS also requires business taxpayers to be up-to-date with all federal tax deposits for the current payroll quarter and in compliance with all required tax filings. For all installment agreement requests, the IRS will only consider a payment plan for an unpaid tax debt if it is determined a taxpayer doesn’t have the ability to immediately full pay the back taxes through assets and income.

What else do I need to know about paying my back taxes by using a payment plan?

The recent IRS Fresh Start program makes it easier for more taxpayers to qualify for a monthly payment plan. Depending on the total balance due, some taxpayers may be eligible to set up an installment agreement without having to furnish the IRS with their financial information. The IRS may also allow for removal of a previously filed tax lien for taxpayers that qualify for a direct debit installment agreement (DDIA). Since interest and penalties continue to accrue during an installment agreement, taxpayers should first consider paying the back taxes in full whenever possible.

See: 11 Tips for Taxpayers Who Owe Money to the IRS

If you need help with setting up a payment plan in Orange, contact us today at 1-714-382-6780 for a free, confidential assessment with skilled Orange CPAs, enrolled agents, and tax attorneys.

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