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Set up Payment Agreement with Irs

If you owe money to the IRS, it can be a stressful situation. However, setting up a payment agreement can be a great way to relieve some of that stress. Here`s what you need to know about setting up a payment agreement with the IRS.

What is a payment agreement?

A payment agreement is an agreement between you and the IRS to pay off your tax debt over time. This can be done through monthly installments.

How to set up a payment agreement?

There are a few steps you need to take to set up a payment agreement with the IRS:

1. Determine your eligibility

To be eligible for a payment agreement, you need to have filed all your tax returns. Additionally, you need to owe $50,000 or less (including interest and penalties).

2. Choose a payment plan

There are several payment plans available, including:

– Installment Agreement: This is the most common plan. You make monthly payments until your debt is paid off.

– Offer in Compromise: This is a plan where you settle your debt for less than what you owe.

– Partial Payment Installment Agreement: This plan is for those who can`t afford the payments of a regular installment agreement. You make payments based on what you can afford.

3. Apply for a payment agreement

To apply for a payment agreement, you need to fill out IRS Form 9465, Installment Agreement Request. You can also apply online at the IRS website.

4. Make your payments

Once your payment agreement is approved, you need to make your payments on time each month. If you miss a payment, you could be charged penalties and interest.

Benefits of a payment agreement

There are several benefits to setting up a payment agreement with the IRS, including:

– It helps you avoid collection action, such as wage garnishment or levies on your bank accounts.

– It can help you avoid the stress of unpaid taxes and the fear of a potential IRS audit.

– You can pay off your debt over time, rather than all at once.

Conclusion

If you owe money to the IRS, setting up a payment agreement can be a great way to relieve some of the stress associated with unpaid taxes. By following the steps above, you can set up a payment plan that works for you and start paying off your debt over time. Remember to make your payments on time to avoid penalties and interest charges.