Taxpayers who cannot pay off their debt within the 72-month timeframe may qualify for a full pay agreement. This agreement allows you to pay off your taxes within the collection period allowed by law (10 years) via pre-determined monthly payments to the IRS. In some cases, you may be required to submit documentation to substantiate your income and expenses and to determine your payment amount.
The IRS also offers payment plans for taxpayers who cannot resolve their tax debt within the collection period allowed by law:
A partial pay agreement requires you to submit complete financial information and documentation of income and expenses to the IRS to determine what you can afford to pay each month. The IRS will review your payment every two years to determine if they can increase.
A staggered payment plan, also called a tiered agreement, allows a taxpayer to pay one amount to the IRS for a predetermined time and then increase the payment amount according to the terms of the agreement. For instance, you may be able to increase your payments to the IRS once you have paid off a car after 18 months. Or you may be asked by the IRS to lower the payments on another debt within a certain timeframe to pay off your taxes quicker.
Setting up a Payment Plan with True Resolve
At True Resolve, our Denver-based tax experts will review the payment options available to you, determining which one best fits your budget and your situation. We negotiate directly with the IRS to ensure the best outcome possible. Contact us today to discuss a plan to pay off your taxes and secure your financial future.