A payment plan is an agreement with the IRS to pay the taxes you owe within an extended timeframe. You should request a payment plan if you believe you will be able to pay your taxes in full within the extended time frame. If you qualify for a short-term payment plan you will not be liable for a user fee. Not paying your taxes when they are due may cause the filing of a Notice of Federal Tax Lien and/or an IRS levy action.

4. Settlement Agreement

If you’re unable to pay your taxes, the IRS may also offer you a settlement agreement. Under this agreement, you would pay a portion of the taxes you owe, and the IRS would forgive the rest. To be eligible for this program, you must:

  • Owe less than $50,000 in back taxes
  • Be current on all tax filings
  • Have no outstanding tax liens

If you meet these requirements, you can submit an offer in compromise to the IRS. The IRS will review your submission and determine if it is acceptable.

The IRS offers tax debt relief options for U.S. taxpayers suffering from financial hardship.

Did you know the IRS is aware of the COVID-19 pandemic and its impact on your finances? The truth is, there are tax debt relief options available to those who qualify.

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