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IRS Installment Agreements (Payment Plans)
An Installment Agreement is a payment
arrangement in which the internal Revenue Service 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, call the attorneys and tax professions of Fried & Rosefelt,
P.A for help. We have substantial experience helping taxpayers negotiate
the lowest possible monthly payment with the IRS. We also often work with state
taxing authorities to negotiate payment plans for our 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 If you cannot afford to make monthly payments and do not qualify for another
type of tax relief, for example, an offer in compromise, our attorneys 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, we 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 us for a free, confidential consultation.
If you are searching for a highly qualified tax representative to negotiate
on your behalf with the IRS or a state agency, call the Fried & Rosefelt, LLC team of tax attorney professionals that can negotiate on your
behalf to create the lowest possible payment plan, or even defer IRS or state
tax collection activity in appropriate situations. Contact us by completing the Consultation Request form or by calling our law office at (301) 656-8528.
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