It is common to have your taxes prepared only to find out you cannot afford to pay the amount you owe. One of the various types of installment agreements available might be a solution for you.

If you owe the IRS or State more than you can afford to pay, you are allowed to make payments over a given period of time. Assuming you owe less than $50,000 and have the ability to full-pay over time, the IRS allows you a 72-month period to do so. This is known as a streamlined installment agreement.

If you cannot pay off your balance in full, you may claim hardship. Claiming hardship is the process in which you make payments based upon your ability to pay and not based upon the amount you owe. If the circumstances apply, you may not need to pay anything. This is known as Currently Non-Collectible (“CNC”) status.

How Installment Agreements work

This process sounds simple but you should know that the IRS has strict rules on what they consider to be necessary and reasonable living expenses as they relate to what you can afford to pay. If the IRS sees that you are paying for items they will not consider in their calculations, you may be forced to pay a monthly amount that is unaffordable.

We are here to help

The Tax Resolution Institute knows EXACTLY what the IRS will and will not allow. By planning properly and creating a comprehensive installment agreement package to submit to the taxing agencies, we ensure that if you enter into an installment agreement, it will be for an amount you can comfortably afford and you will be able to pay that amount over an extended period of time.

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