Installment Agreements allow a taxpayer that owes the IRS to repay the debt in a set amount of monthly payments. Installment Agreements are the most commonly accepted tax debt resolution. This blog post will help you get an understanding of what your installment agreement options are.
Non-Disclosure Installment Agreements
With these installment agreements, the IRS will never pry into your finances. You will never need to worry about your 401K or CDs being vulnerable to attack. In order to qualify for this agreement, your tax debt needs to be under $25,000. Your payments will be based on how much is needed on a monthly basis to pay your entire debt with penalties and interest in five years or when your statute of limitations runs out (if it is sooner). If you are in a temporarily binding financial situation, you may find that a Tiered Non-Disclosure Installment Agreement will work out best for you. In this case, you set what you know you can afford as your monthly payment for the first year and make up the difference with higher payments afterward.
Voluntary Disclosure Installment Agreements
If you owe more than $25,000 or cannot afford the payments offered by a Non-Disclosure Installment Agreement, you can disclose your finances to get into a payment plan. Your payments will be based on your ability to pay. You will have until your statute of limitations to pay your entire debt in full. Be extremely careful with this. Most people do not understand that the IRS has a different view on what standards of living entail than the majority of Americans have. Disclosing your finances may lead to extremely unaffordable payments or, much worse, levies on accounts that the IRS did not know about previously.
If you owe more than $10,000 in tax debt, it is in your best interest to talk with a tax debt professional before setting up an installment agreement. My Hit Squad is the best in the business! We will be honest with you on what installment agreement options you have, as well as look into what other helpful tax resolutions you may qualify for. Just fill out the submission form or give us a call at 888-415-1337!