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Tax Extension Deadlines 2022

man completes tax deadline taxes working at café Do you often procrastinate until the last minute? If so, you likely already know how that trait can wreak havoc on your life. Unfortunately, procrastination is the reality for about a third of Americans who wait until the last week before Tax Day to compile and file their taxes.

Filing your taxes before the next deadline can save you from additional headaches, penalties, and correspondence from the IRS. Get all the details about the next tax deadline extension and how to make sure you meet it below.

What Happens if You Miss the Tax Deadline in 2022?

Tax Day in 2022 was on April 18. The IRS expected all taxpayers to file their taxes on or before that date. So, what happens if you missed that tax deadline?

If you didn’t file by April 18 and you didn’t file for an extension, you may already have been penalized without your knowledge. After 60 days, the IRS initiates an automatic late-filing penalty. This fine is a minimum of $435, but it can exceed that if you owe more than $435 in taxes.

What’s more, this late filing penalty will continue to grow by about 5% each month until you eventually file your returns. That means even a small tax amount can grow into a huge mountain if you don’t take action, file for an extension, or ultimately resolve your tax return.

If the IRS reaches out about your tax bill and you start to willfully evade them, they may take further action against you.

What Is a Non-Filing Penalty?

A non-filing penalty is a late fee charged to taxpayers each month they are late on their taxes. The penalty begins accumulating 60 days after the official Tax Day. Once the taxpayer files their taxes, the penalties will stop.

Keep in mind that the non-filing penalty is not the same as the late-payment penalty, which can continue to accrue even after you’ve filed your taxes.

What’s a Tax Extension?

Anyone who has filed taxes knows that the process can be time-consuming and costly. If you know that you don’t have all your documents together, you can file for a tax extension. An extension increases the amount of time you have to file your taxes. It’s important to know, however, that it won’t give you more time to pay. It’s best to either pay an estimated amount or simply plan on paying interest, penalties, and fees later.

How Long is an Extension on Taxes?

So, how long is a tax extension? Usually, you can request up to six months to file your taxes. If you filed for an extension in 2022, then you have until October 17 to file your taxes.

Is There a Penalty for Filing a Tax Extension?

You won’t be charged any type of penalty or fee for filing a tax extension. It’s crucial to understand, however, that an extension does not prevent penalties. In other words, interest and penalties for not paying your taxes will continue to grow despite an approved extension.

What Are Installation Agreements?

Have you been so hesitant to file your taxes because you’re afraid you’ll receive a bill you can’t resolve right away? If so, then don’t fret! It’s important to understand your options, which include arranging an Installment Agreement with the IRS—that’s basically a payment plan to resolve any outstanding tax debt balance.

Common Installment Agreement Terms

In general, the terms of an installment agreement are simple: You agree to pay off your tax debt each month, and the IRS agrees not to pursue collection efforts against you. The amount you’re obligated to pay will depend on your financial situation. The IRS will request your financial details, and they’ll decide on a payment amount based on what you provide.

Do You Have Tax Questions? Do You Need Help With a Tax Deadline Extension?

While this article makes resolving your taxes sound simple, it’s often intimidating for the average taxpayer to square up with the IRS regarding a tax situation. For starters, the average taxpayer isn’t usually confident regarding their tax knowledge. In addition, taxpayers might feel worried about collection efforts that might start after getting in touch with the tax agency.

If you have these concerns or other tax questions, we recommend getting in touch with a tax expert about your situation. They can help you feel confident in pursuing a tax solution that works for both you and the IRS.

Act Now to Meet the Tax Deadline in 2022

The initial tax deadline passed in April, but another is looming in October. If you filed for a tax extension, then you still have time to get in good standing with the IRS. It makes sense to start working on your taxes now to avoid further penalties and consequences. If you have questions, or you’re struggling to get your taxes filed, it might make sense to consult with a tax expert about how to proceed.

At Tax Group Center, our agents have ample experience helping taxpayers solve their complicated tax issues. If you’re interested in hearing more about how our services can help, we invite you to complete our online tax debt form now to hear back from one of our agents about your situation.

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How to Complete an IRS Form 433-D Installment Agreement

man working on taxes at desk with computer and calculator

man working on taxes at desk with computer and calculatorIn 2021, about 2.4 million Americans established new payment plans with the IRS because they could not afford their entire tax debt bill right away. Compared to 2020, that number is a 29% increase!

There are many reasons why more Americans are struggling to pay their tax debt, and one of them is the extremely delicate financial situation we’re all in right now.

Did you recently receive a tax debt bill that you know you can’t pay off? If so, you’ll want to know all about IRS Form 433 D, also known as the IRS installment agreement form. Learn everything you need to know about this important tax form and how to fill it out correctly below.

What Is an IRS Installment Agreement Form?

Each year, Americans are expected to file their taxes and then pay a fair share of their tax burden. As you’d imagine, quite a few citizens end up receiving their tax bills and then feeling shocked by the total amount they owe. This is especially true when the person has experienced certain life or income changes or started a business.

Regardless of the reason, the IRS expects citizens to pay up in full upon receiving the tax bill.

When taxpayers can’t afford to pay off the full amount in one go, they must communicate that with the IRS. From there, they’ll need to work on a solution. An IRS installment agreement is one type of tax debt relief solution that allows taxpayers to pay off their tax debts in monthly installments while also avoiding further collection efforts from the IRS.

More specifically, an IRS Form 433-D is an installment agreement that involves direct debit transactions. In other words, your monthly IRS payments will immediately come from your bank account when they’re due.

Should You File an IRS Form 433-D?

IRS Form 433 isn’t for everyone. You should file this form if you owe the IRS a significant chunk of money and you can afford to make monthly payments from your bank account. 

You shouldn’t fill out this form if:

  • You are able to pay off the full tax debt
  • You are unable to make monthly payments without enduring a financial hardship
  • You disagree with the tax bill you received
  • You want to make monthly payments, but not in a direct debit situation

If your situation falls into one of those categories, don’t think you’re out of options! You might have other options available, including filing for currently non-collectible status, innocent spouse relief, or even applying for penalty abatement, which can help you navigate your tax situation without the extra burden of penalties, fees, and interest.

Terms and Conditions You Need to Understand

If you do decide to go with an installment agreement, then it’s important to also note the terms and conditions that come along with applying for this type of financial relief. If you decide to go with this program and you’ve signed the agreement form, you’re bound to pay the outlined amount each month, including any penalties and interest.

Your IRS Form 433-D should include the information about your bank account and the amount that will get deducted out of your account each month. In most cases, payments will start about 60-90 days after completing your form and submitting it either online or via snail mail.

If you fall behind on your payments, you’ll be considered in default with the IRS. This could result in the IRS terminating your agreement entirely.

When you submit IRS Form 433-D, you will be charged a service fee. If you complete the entire process online, you’ll need to pay anywhere from $31 to $149. If you opt to complete your form on paper and submit it via snail mail, you’ll end up paying up to $107 to submit the installment agreement forms.

How to Fill Out IRS Form 433-D

You can fill out IRS Form 433-D either online or on paper. If you opt to fill out the form on paper, then you can utilize our free downloadable tax forms. If you’d prefer to fill out the form online, you can do so directly on the IRS website.

First, enter identifying information like your name, address, Social Security number, phone number, employer information, and the kinds of taxes you filed for. You’ll want to enter the tax periods of the years you owe for and the total overall amount you owe. Write your initials in the provided box and provide your bank routing and account numbers.

What to Do With a Completed IRS Form 433-D

Are you wondering where to mail IRS Form 433-D once you’ve completed it? Mail your form to:

Internal Revenue Service

ACS Support P.O. Box 8208

Philadelphia, PA 19101-8208

Do You Need More Help With Your IRS Form 433 D?

There are countless reasons why someone might receive a tax bill they can’t pay off in full right away. When that’s the case, you should always work with the IRS to discover your best course of action. The absolute worst thing you can do is ignore your tax debt and hope that it goes away. The IRS will inevitably catch up with you. At that point, they may decide to initiate collection efforts against you.

These collection efforts could vary from mild to very extreme. The IRS has the authority to seize your property and garnish your bank accounts.

To avoid this type of situation, all you’ll need to do is fill out IRS Form 433 D and apply for an IRS installment agreement plan. If the IRS approves your plan, then they’ll stop all collection efforts and you’ll once again be in good standing with the tax agency.

Do you have more questions about an installment agreement with the IRS? Do you need help with your tax forms? Regardless of where you stand with the IRS, we can help. Reach out to our office now to get in touch with our team of highly qualified tax experts who can help you meet your financial goals.

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Updates to Offer in Compromise Policy in 2021 (that will affect 2022)

Are you struggling to pay off your tax debt? If so, then you may have heard about the IRS offer in compromise (OIC) program. You’re likely considering applying for the program, but will you get approved for tax debt relief?

Less than half (41%) of IRS offer in compromise applications are approved. One of the main reasons why an IRS OIC application gets denied is because the taxpayer didn’t qualify and applied without understanding the complicated program’s rules.

In 2022, things have gotten even more complex.

Starting in November of 2021, the IRS changed its IRS compromise policy. You’ll need to understand both the way the program works and the new changes before you attempt to apply in 2022. 

Learn everything you need to know to get started on your application below.

Current IRS OIC Policy

First things first: How can the current IRS OIC policy help you if you’re a taxpayer with tax debt? To understand the answer, you have to know the basics of what an offer in compromise is. 

An offer in compromise is a formal term for an agreement you make with the IRS. If you owe the agency a significant chunk of tax debt and you can’t pay it back, then it’s possible to come to an OIC with the tax agency.

In most circumstances, this agreement forgives some of the taxpayer’s tax debt while requiring some of that money be paid as soon as possible. In this way, an OIC is beneficial for both the IRS and taxpayers who honestly cannot pay back the entirety of what they owe.

There are three main types of OICs: 

  • An OIC for Doubt as to Collectibility happens when you can’t pay off the balance, even with your potential future income and assets. 
  • An OIC for Doubt as to Liability happens when you’re unsure if you really owe as much as the IRS says. 
  • An OIC for Effective Tax Administration happens when the taxpayer is going through an economic hardship that would warrant a reduction in the full amount of tax debt owed. In this last type of OIC, both the IRS and the taxpayer agree on the amount of tax owed and that it could get paid off in full if it wasn’t for the recent hardship situation. The hardship can’t be a temporary thing, either.

Most taxpayers that want to seek out an OIC apply for an OIC for Doubt as to Collectibility. Keep in mind that this type of OIC has the highest denial rate, too.

So, how do you know if your financial situation meets the standards required by the IRS to get accepted for an OIC? 

When you apply for this type of relief, the IRS will immediately evaluate your entire financial situation and history. For the most part, the IRS won’t accept an OIC unless you offer to pay back more than the agency’s calculated “reasonable collection potential.”

Your reasonable collection potential is how much money the IRS thinks it could get from you if they levied their authority against you. In other words, if they seized your assets and could get more than what you’re offering to pay back, then they won’t accept an OIC.

If you offer to pay back more than the agency could collect through other methods, however, then they’ll be more willing to work with you and approve your application. The agency does consider your living expenses and living situation when calculating your personal reasonable collection potential. The agency will also take into account whether you have dependents or become disabled. 

If you and the IRS come to an agreement, then you’ll need to keep up with your payments to the agency. You could pay back your debt in either one major lump sum or with periodic payments. If you want to make periodic payments, then it’s important to include your first proposed payment with your initial application.

New OIC Policy

Are you seeking out an offer and compromise with the IRS in 2022? You’ll need to know about two specific changes that went into effect in late 2021. These changes mainly impact the refund recoupment process and the ability for taxpayers to use a separate OBR remedy while their OIC situation is under review by the IRS. We’ll go over each of these changes in detail below.

Returns

Prior to these new changes, the IRS included a caveat when an OIC agreement was reached: The agency would keep any tax refund owed to the taxpayer through the calendar year in which the OIC gets accepted. Starting in late 2021, though, the IRS won’t offset, recoup, or keep the refunds during the year that the OIC gets accepted.

That’s great news for taxpayers!

In other words, if you apply for an offer in compromise with the IRS for the years 2015 and 2016, then your 2021 tax return is safe from getting withheld from you. 

Many taxpayers avoid even applying for an OIC because they’re afraid that they won’t get their return for the current year. That’s because taxpayers who are facing economic hardship are often reliant on that yearly tax return. Offsetting the current year’s return, then, could cause further financial harm to the taxpayer seeking relief. For that reason, the IRS made the right decision in changing these rules.

OBR Remedy

An offset bypass refund (OBR) is another type of tax debt relief offered by the IRS. The IRS has the legal authority to offset or keep an overpayment or tax refund when the taxpayer owes a prior tax liability. When taxpayers are going through a financial hardship, sometimes the IRS will offer an OBR, which allows that overpayment to go directly to the taxpayer rather than the agency.

Prior to the recent changes, taxpayers that had pending OIC offers on the table couldn’t also apply for the OBR remedy. These changes reverse that, though, so now taxpayers can apply for the OBR remedy even if they have an OIC pending.

Again, this is great news for taxpayers who are hoping to seek an OIC in 2022 or beyond. With the ongoing Covid-19 situation, getting fast financial relief has never been more important. Getting an OBR is a real challenge, though, and there aren’t any specific forms to request this type of relief. Instead, it’s advised that you either contact the IRS directly or speak with a tax professional for help in getting an OBR.

Apply for an OIC

Clearly, it’s complicated and confusing to determine if you qualify for an OIC program. If you know you owe a tax debt, though, then you should definitely consider this option. If you have questions about your eligibility, then we advise speaking to a tax professional about potentially applying for an OIC.

If you’re sure you want to move forward with applying, then the first step you should take is to get all your finances in order. Next, you’ll need to fill out all the appropriate IRS forms. This step can get a little tricky, and you need to be very sure that you provide accurate information to the agency. Otherwise, you could risk having your application denied.

The forms you’ll need to fill out might include: 

  • Form 656 (Offer in Compromise)
  • Form 433-A (OIC) 
  • Form 433-B (OIC)
  • Form 656-L
  • Form 656

The forms you’ll need to complete depend on the type of OIC you’re hoping to get approved for. Ask a tax professional if you need help figuring out which forms are appropriate in your situation. Finally, you’ll want to include an application fee and any first proposed payment.

Updates to the IRS Offer in Compromise Policy for 2022 and Beyond

Previous IRS offer in compromise rules may have discouraged some taxpayers from seeking out an OIC. Hopefully, the new changes implemented by the IRS in 2021 will help reverse that trend. After all, delinquent taxpayers who do end up paying off some of their tax debts are better than ones who never attempt to pay back anything towards what they owe.

If you currently owe the IRS a significant amount of money, then it’s normal to feel anxious. It makes sense to feel overwhelmed, too, especially if your tax debt goes back several years. Further inaction on your part isn’t recommended as we head into 2022. Rather than continuing to feel anxious and stressed, act now by reaching out to an expert tax representative who can help you get back on track.

At Tax Group Center, we’ve helped countless individuals and businesses successfully gain acceptance into the IRS OIC program. Our tax attorneys and licensed CPAs can help you with the Offer in Compromise process, too. Contact us to get started!

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Understanding the IRS Hardship Program

Woman figuring out how much she owes to the IRS

Woman figuring out how much she owes to the IRSFor every 35 cents the IRS spends, the department collects $100 in revenue. One reason why the IRS has such a high collection rate is they don’t waste resources going after individuals who simply cannot pay the debt they owe.

Individuals who can’t afford basic living expenses and their tax debt often apply for the IRS hardship program. Once their case gets evaluated, individuals who qualify might get approved for more time to pay off their debt or other types of relief. If you currently owe the IRS a significant chunk of money but live paycheck to paycheck, then you should investigate IRS hardship rules to see if you’re eligible for this type of financial relief.

Learn everything you need to know about IRS hardship and how to apply below.

What Is IRS Hardship?

Did you know that the majority of Americans (61%) didn’t pay any federal income taxes in 2020? While that statistic might initially seem surprising, it makes sense when you consider that an overwhelming number of Americans simply can’t afford to pay their taxes. After all, the 2020 pandemic caused widespread unemployment, financial hardship, and an ever-increasing cost of living. 

When you run into unexpected financial hardship, you don’t have to struggle. There are options for you, and the IRS hardship program is one of those options. 

“IRS hardship” is a term the IRS uses to define Americans who are in “Currently Non-Collectible” status (CNC) or have agreed to a partial pay installment agreement. These individuals have applied for IRS hardship because they couldn’t afford both their basic living expenses and their tax burden.

Not everyone who is struggling financially meets the IRS hardship requirements, though. Plus, getting filed under CNC does not mean that your tax debt is permanently eliminated. That’s why it’s crucial to understand exactly what the IRS hardship program is and how it can help you.

What Is the IRS Hardship Program?

Getting a tax bill that you can’t pay off is one of the most common tax problems Americans face. If you know you honestly cannot pay off your IRS tax bill right away, then it’s important to recognize the tax burden and respond to the IRS. A failure to act could lead to further collection efforts.

First, you need to reasonably consider whether you can pay any of your tax bill. If you’re currently struggling with financial hardship, then the IRS will take that into account. If the IRS determines you can pay the full amount, then you won’t be eligible for the program. Rather than wasting time and effort going through these motions, take the time to really analyze your finances before considering this program.

Next, you need to learn what the IRS hardship program is about. It’s designed for individuals struggling to meet their reasonable, basic living expenses. You’ll need to prove this fact to the IRS, and they’ll evaluate your situation and the proof you provide. If you qualify for the program, then you’ll get offered relief in the form of either CNC status or a partial payment plan. You may get offered additional time to pay off your debt without further penalties and fees.

Who Qualifies for the IRS Hardship Program?

When you fill out an IRS hardship form, you’ll need to provide detailed information about your financial status, assets, income, spending, and average expenses. All these details are important because they’ll help the IRS determine if you qualify for the hardship program or other types of tax debt relief.

To be eligible for CNC status, taxpayers must prove that paying off their taxes would prevent them from meeting their reasonable living expenses. These “reasonable” expenses include:

• Food

• Clothing

• Housing

• Utilities

• Out-of-pocket healthcare expenses

• Transportation

If you have little to no funds left after meeting these needs, then you could qualify for the IRS hardship program. In most situations, you must also earn less than $84,000 a year.

Hardship Rules

As if qualifying for IRS hardship wasn’t hard enough, you need to understand how hardship rules work. In most cases, you’ll only qualify for this type of relief on a yearly or bi-yearly basis. Often, the IRS will completely review your financial information every two years to determine if you’re still eligible for the program. In cases where a taxpayer’s situation has changed, the IRS may revoke financial hardship status.

Your hardship status will not automatically roll over into a new year when you file taxes. If you need your financial hardship status to roll over, then you’ll need to fill out another IRS hardship form for the year you can’t pay. If possible, the best thing to do is to pay off your new taxes as soon as possible to prevent getting further into debt. Paying off your new taxes will not impact your previous hardship standing.

It’s also crucial to stay current with your tax returns while you’re in hardship status. You still need to file your returns on time. Otherwise, you could face a penalty of 5% of your unpaid taxes. This penalty could get levied every month for up to five months.

Will IRS Collection Efforts Continue?

A common thread on tax FAQs is how to stop IRS collection efforts. When you’re facing a tax levy, a seizure of your assets, or wage garnishment, your situation can feel pretty dire. The good news is that applying for the IRS hardship program and achieving CNC status can stop collection efforts for that tax liability. It is important to understand, though, that you’ll need to get hardship status for all your tax debt in order to stop all IRS collection efforts.

If you’ve been notified about IRS collection efforts, then it’s in your best interests to consider reaching out to tax attorneys who can help you navigate your situation.

How to Apply to the IRS Hardship Program

Filing an IRS hardship application is something that you can do on your own, but it’s advised that you consider speaking with a tax consultant before you do. A tax consultant will ensure that you fill out your application correctly and thoroughly. They’ll also help you collect any documentation and proof to back up your financial claims.

To apply, you’ll first need to fill out IRS form 433-F. This will explain your monthly income, expenses, assets, and liabilities. You’ll need to be as accurate and thorough as possible on this form. If necessary, the IRS may also request a 433-A form, which is a longer and more detailed version of form 433-F. Gather up any documentation that supports what you list in the form.

Once this information is submitted, the IRS will analyze your case. You should get a response from the IRS within a few weeks.

Alternative Payment Plans

If the IRS hardship program determines you can pay back a portion of your tax debt, then they may suggest putting you onto a partial payment plan. This type of alternative payment plan allows you to pay back a portion of your tax debt while also relieving you of the full burden. Depending on your situation, the IRS might also say that you qualify for an extension on your payment time due to the undue hardship you’re facing. If you’re hoping to seek out an extension, then you’ll want to use IRS form 1127.

Another common type of alternative payment plan is an IRS settlement or Offer in Compromise. This type of relief is available for taxpayers who don’t think they’ll be able to pay off their tax debt in the immediate future. Rather than accepting their full tax debt liability, the taxpayer can come to an agreement with the IRS for a reduced amount.

Are You Interested in Applying for the IRS Hardship Program?

The IRS hardship program was designed to help provide financial relief to Americans who genuinely can’t afford to pay off their debt without sacrificing their basic necessities. While the agency’s hardship rules might seem strict, these qualifications are put into place to ensure that no one abuses this financial relief option.

Now that you’re empowered with the knowledge about what the IRS hardship program is, who qualifies, and what it can do for you, are you interested in applying? While you could always try to navigate IRS rules and regulations by yourself, it’s reassuring to have a tax expert by your side. Here at Tax Group Center, our tax attorneys, certified tax consultants, and CPAs have helped countless Americans find tax debt relief through the IRS hardship program and other programs.

Contact us today to learn more about your eligibility and options.

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Can You Have Two Installment Agreements With the IRS?

Can You Have 2 Installment Agreements With the IRS

Can You Have 2 Installment Agreements With the IRSIn 2011, the IRS Fresh Start program created a bridge to debt forgiveness for delinquent taxpayers that continues to help countless Americans settle federal tax debts today. The program is expansive, fairly easy to enroll in, and designed to minimize penalties. While the IRS offers a range of debt relief options that include Offer in Compromise (OIC) and Currently Non-Collectible (CNC), the most widely used option is the IRS Installment Agreement (IA).

While an IA doesn’t forgive your debt, it does allow you to pay it over time without incurring fees and penalties. It’s also the easiest option to qualify for within the IRS debt forgiveness program. Taxpayers who apply for the program are able to set up payment plans with the IRS that can last up to six years (72 months). 

If you’re already enrolled in a payment plan with the IRS for an existing tax bill, you may be wondering what your next step should be if you can’t pay this year’s tax bill. Can you have 2 installment agreements with the IRS? Take a look at the steps to change IRS payment plan terms.

Can You Have 2 Installment Agreements With the IRS?

No, you can’t have multiple installment agreements with the IRS simultaneously. That doesn’t mean you’re out of luck if you have new tax debt. What’s more, there may be a way to figure out how to change IRS payment plan terms, resulting in you owing less than you did with your existing IRS agreement. But first, you have to understand the IRS’s policy on handling new debt when you already have a payment plan.

If you’re already enrolled in an Installment Agreement with the IRS, you may remember that you agreed to some lengthy terms when you were approved for the program. One of those terms was that you promised to stay current with all future tax payments. If you fail to pay or file future taxes, your IRS Installment Agreement for past taxes defaults. That means the IRS will expect you to pay both your past debt and your new debt immediately. You’ll also lose the penalty and interest protection that the IRS Installment Agreement gave you.

If you have a new tax debt when you’re already enrolled in an Installment Agreement, do not just avoid paying your taxes! The IRS won’t technically allow you to apply for a new Installment Agreement, but you can learn how to change IRS payment plan terms to account for the new debt. 

Keep in mind that you’ll need to check if you still qualify for an IRS Installment Agreement with your new debt figured into the equation. The requirements are:

  • Long-Term Individual Payment Plan: You owe $50,000 or less in combined tax, penalties, and interest with all of your returns filed.
     
  • Short-Term Individual Payment Plan: You owe less than $100,000 in combined tax, penalties, and interest with all of your returns filed.
  • Long-Term Business Payment Plan: You owe $25,000 or less in combined tax, penalties, and interest with all of your returns filed.

It’s crucial to contact the IRS to reapply for a modified agreement that folds your new tax debt into the balance of your payment plan. You need to do this before your taxes are due. If your balance is too large to handle in monthly payments, you may actually be able to switch to a new type of loan forgiveness option based on your updated debt total. Just remember that nothing can be done until you file all tax returns that are owed to the IRS.

How to Modify an IRS Installment Agreement

Act quickly, because your existing agreement with the IRS will be in default as soon as the IRS assesses your new tax balance. If you’re unsure about what to do, have a tax professional contact the IRS on your behalf to request a modification. If you disagree with the debt balance that the IRS has provided, you can also submit Form 9423: Collection Appeal Request to contest your tax bill.

If you agree with the tax bill, you can request to have the new balance added to your existing Installment Agreement. While the IRS won’t allow you to have two separate Installment Agreements, you can consolidate your tax debt into a single payment plan fairly easily. 

The process is the same for both individual and business IRS Installment Agreements. If you’ve already allowed your current agreement to lapse by default, you may be required to pay a reinstatement fee. There’s also a chance that you may not be able to make your new monthly payment amount based on your monthly income once all of the numbers are plugged in. This might make you eligible to move from an Installment Agreement to another IRS forgiveness option.

If your new total is unpayable based on your monthly income, you can fill out IRS Form 433-F: Collection Information Statement. This is the form that the IRS uses to determine if delinquent taxpayers are eligible for Offer in Compromise or Currently Non-Collectible status. If you are eligible, you may be able to negotiate your tax debt down to a lower figure.

You Don’t Have to Learn How to Modify an IRS Installment Agreement Alone

If you know a tax bill that you can’t pay is coming, don’t wait until your current IRS payment plan goes into default. At Tax Group Center, we help taxpayers modify their Installment Agreements to continue taking advantage of the IRS Fresh Start program. Contact us today to work with a team of lawyers and CPAs with 30 years of experience to find out how to change IRS installment agreement terms!

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