Tax Plan

IRS Installment Plans

Setting up a monthly, recurring payment plan with the Internal Revenue Service (IRS) is one of the easiest ways to comply and pay your past due federal tax. Once you are placed on an acceptable and approved Installment Agreement with the IRS, all collections actions shall discontinue. Collections actions can include, but are not limited to accrued interest and penalties, offset refunds, bank levies, wage garnishments or property seizures.

Currently the Internal Revenue Service (IRS) is offering short-term and long-term payment plan options. Allow our Enrolled Agents to assist you in choosing the best installment agreement that allows you to allocate a plan that fits your financial plan.

What type of Payment Plans does the Internal Revenue Service (IRS) offer? Payment options include full payment, short-term payment plans or long-term payment plans.

How do I choose the right payment plan? Your specific tax situation will determine which payment options are available to you. Payment options include full payment, short-term payment plan (paying in 120 days or less) or a long-term payment plan (installment agreement) (paying monthly). Currently, taxpayers may only apply for a short-term payment plan of more than 120 days (up to 180 days).

Offer in Compromise

An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service (IRS) that allows the taxpayer to propose an amount to settle the outstanding tax liability for less than the full amount owed. Although there are prerequisites to consider prior to the application, the IRS agree to settle tax liability for taxpayers and business who are current and in compliance with IRS tax regulations.

How long does it take to process an Offer in Compromise (OIC)? This process is lengthy. Processing times may vary. The Internal Revenue Service (IRS) typically acknowledges receipt of the proposal within 30 days of receipt. The ultimate decision to accept or reject the proposed offer can take up to 6 months or longer to evaluate.

What happens if the Internal Revenue Service (IRS) rejects my Offer in Compromise (OIC) proposal? If you receive a rejection letter, you have 30 days from the date of the OIC rejection letter to request an appeal of the decision.

When it comes to negotiating with the IRS, our Enrolled Agents have the skills, knowledge and expertise to propose a best-case scenario for settling tax cases.

How long is the Offer in Compromise settlement process?

In general, it may take from six to twelve months to successfully negotiate an IRS Offer in Compromise. Full IRS compliance is a requirement prior to filing.

Once the Offer in Compromise is accepted, how long will I have to pay?

Generally, you are given two options when settling an Offer in Compromise tax settlement:

  1. A Cash Settlement – allows the agreed tax settlement to be paid within 5 months of acceptance.
  2. A Periodic Installment Payment – allows the agreed tax settlement to be paid in equal monthly payments up to 24 months.

Penalty Abatements

If you are not able to satisfy the tax you owe by your original filing due date, the balance is subject to interest and a monthly late payment penalty. There are also penalties for failure to file required tax returns

As a taxpayer, you may qualify for penalty relief if you made a conscious effort to comply with the requirements of the law; however, you were unable to meet your tax obligations, due to unforeseen circumstances beyond your control.

What are some common reasonable causes for penalty abatement?

The IRS will determine penalty abatement requests based on circumstances beyond your control such as medical illness, death, natural disasters, theft, or lack of professional advisement. Additional causes can and may be considered. It is advisable to remit requests with corroborative documentation.