IRS payment plan help: can’t pay in full? We’ll help you set up monthly payments.
You’ll know what the IRS says you owe, which payment plan you qualify for, and what the monthly payment would be before we request it for you. We work with taxpayers in all fifty states.
Chris Brown, Enrolled Agent
You work with me directly, start to finish.
Who can help me set up a payment plan with the IRS?
A tax professional licensed to represent you before the IRS can set up the payment plan for you. That is the IRS payment plan help we provide, in all fifty states. We first get your IRS records, so you know what you owe for each year and which plan you qualify for. Then we request the installment agreement from the IRS for you. While a request is pending or a plan is in effect, the IRS generally cannot levy your wages or your bank account.
If you owe $50,000 or less, the IRS says more than 90% of individuals qualify for its Simple Payment Plan, which needs no financial statement. If you owe more than that, if a return is still unfiled, or if a plan you already had has defaulted, there is more to do, and we can help you with that too.
Chris Brown, Enrolled Agent
You work with me directly, start to finish.
Whether you searched for tax relief, tax debt help, a tax attorney, or a CPA, you need someone the IRS will talk to about your account. At NH Tax Advisors, Chris Brown is an IRS Enrolled Agent, licensed to represent taxpayers before the IRS in every state. Once you sign a power of attorney, we can speak to the IRS for you, so you do not have to make those calls yourself.
IRS bill or levy notice? We can help you request a payment plan in time.
The IRS sends its letters in a fixed order, so the one you are holding tells us how much time you have. If you received a CP14, that is the first bill, and the IRS sends more notices before it can levy. If you received a CP504, the IRS is saying it intends to take your state refund and may file a public tax lien. If you received a final notice (an LT11 or Letter 1058), the IRS can levy your bank account or garnish your wages 30 days after the date on it. In that case the payment plan request needs to reach the IRS within those 30 days, and we treat it as urgent. Whichever letter you have, interest is added daily at the federal short-term rate plus 3%, and the late-payment penalty adds half a percent a month. If your tax debt is over $66,000 and a lien or levy is already in place, the IRS can also ask the State Department to hold your passport, so tell us if you have travel coming up. From the moment a payment plan request is pending, the IRS is generally barred from issuing a levy, and that continues while the installment agreement is in place and you keep paying. We can help you get that request to the IRS, for the plan your balance qualifies for.
- We check your IRS records first, so your payment plan covers every year the IRS shows a balance for
- We request the plan your balance qualifies for, with the forms that plan requires, so your request is complete when the IRS receives it
- We ask the IRS to remove penalties where First Time Abatement applies, which can lower what you have to pay back
- We help you choose a monthly payment you can keep up, and set it on direct debit, so a payment is not missed by accident
- We make the calls to the IRS for you, so your time is not spent on hold
- You see what you owe and what the plan would cost you each month before you decide anything
“Very professional, and went above and beyond to help us. We will definitely be using Chris in the future moving forward.”
How we help you set up a payment plan with the IRS
- You find out where you stand. You sign a power of attorney (Form 2848), and we pull your IRS account records. You get a one-page summary: what you owe for each year, any return the IRS shows as missing, and the payment plan your balance qualifies for. The IRS denies a payment plan request when a required return is missing, so we check for that before anything is sent.
- You choose a payment you can keep up. We show you the monthly payment each plan would need, and nothing goes to the IRS until you approve it. We also check whether paying part of the balance now would put you in a plan with less paperwork, and we ask for penalty relief where you qualify.
- We request the plan and help you keep it. We request the payment plan from the IRS for you, by phone, online, or on Form 9465, and send you the IRS’s written confirmation when it is approved. We then help you adjust your withholding or estimated payments, because a new balance next April would default the plan.
Which IRS payment plan do you qualify for?
The IRS offers different payment plans depending on how much you owe, and the amount decides how much paperwork it asks for. At $50,000 or less, the IRS asks for no financial statement. Over $50,000, it asks for your income, expenses, and assets on Form 433-F. More than one row below can apply to you, and we can tell you which plan suits you best once we have seen your IRS records.
| What you owe | The IRS payment plan | What the IRS requires | What we need from you |
|---|---|---|---|
| Under $100,000, and you can pay it within 180 days | Short-term payment plan. No IRS setup fee, and no monthly agreement to keep up afterward. | The request only. | Signed power of attorney, your latest IRS letter, and the date you can pay by. |
| Tax of $10,000 or less | Guaranteed installment agreement. The law requires the IRS to accept it if you filed and paid on time for the past five years, had no payment plan in that time, and pay it off within three years. | The request only. | Signed power of attorney, your latest IRS letter, bank details for direct debit. |
| $50,000 or less, including penalties and interest | Long-term payment plan. The IRS now calls it a Simple Payment Plan, and used to call it a streamlined installment agreement. No financial statement and no lien decision required, with up to 10 years to pay, or the remaining collection window if shorter. | The request, plus all returns filed and this year’s withholding or estimates current. | The same, plus the most you can pay each month. |
| Over $50,000 | Non-streamlined installment agreement, requested on Form 9465 with a Form 433-F financial statement. The IRS reviews your income, living expenses, and equity in your home, vehicles, and accounts, and may ask you to pay part of it first. | The request, the financial statement, and proof of what is on it. | The above, plus three months of bank statements, recent pay stubs, and your monthly mortgage, loan, insurance, and medical figures. |
Every option has one condition: all required returns filed, and this year’s withholding or estimated payments current. The IRS denies a request that fails that check, whatever the balance. If a return is missing or your estimates are behind, we can help you fix that first. The IRS has also dropped two older requirements: the 72-month payoff limit, and mandatory direct debit for balances between $25,000 and $50,000.
If you are not sure what you owe, or whether every year is filed, call us. We can pull your IRS transcripts and tell you which payment plan you qualify for before you commit to anything.
Owe more than $50,000? We can help you complete the IRS financial statement.
If you tried the IRS website and were turned away, the reason is usually the balance, because the IRS online application stops at $50,000. Above that line the request goes in on Form 9465 with a Form 433-F collection information statement, and the IRS decides whether to file a tax lien as part of its review. The IRS also compares your living expenses with its own allowable standards, so it can ask for a higher monthly payment than the one you proposed. We prepare the Form 433-F with you, so every expense the IRS allows is claimed and documented, and the payment the IRS works out rests on complete and accurate figures. If you can bring the balance under $50,000 first, the financial review is not needed at all.
Example: $61,000 owed, and the $12,000 payment that changes the paperwork
Say the IRS shows a $61,000 balance across two years, including penalties and interest. At that figure the request goes by mail on Form 9465 with a Form 433-F attached, which means listing every account, vehicle, and monthly expense, and then waiting about 30 days for an answer. The IRS itself encourages paying the balance below $50,000 first. If you can put $12,000 toward it, from savings or a loan, the remaining $49,000 qualifies for a Simple Payment Plan: no financial statement, no lien decision, and a request the IRS answers immediately online. Spread over six years, $49,000 is about $680 a month, plus the interest and penalty that keep accruing until it is paid.
Ask us whether a down payment changes your options before anything is filed.
Penalties still adding up? A payment plan can halve the late-payment penalty.
The late-payment penalty runs half a percent of the unpaid tax each month, up to 25%. Once an installment agreement is in effect, the law cuts that rate in half, to a quarter percent a month, for every month the payment plan is in place, provided the return itself was filed on time. Interest continues at the normal IRS rate either way, and the IRS generally cannot levy your paycheck or your bank account while the plan is in effect. We can tell you from your IRS records what the penalty and interest are adding each month, and what a payment plan would change.
Example: $20,000 in back taxes paid over two years, with and without a payment plan
| With no payment plan | On an IRS installment agreement | |
|---|---|---|
| Late-payment penalty rate | 0.5% a month | 0.25% a month |
| Penalty over 24 months | Up to about $2,400 | Up to about $1,200 |
| Interest | Accrues daily | Accrues daily |
| Levy or wage garnishment | Possible after the final notice | Generally barred while the plan is in effect |
| IRS setup fee | None, and collection continues | $22 online with direct debit |
The $1,200 difference is the penalty alone. A payment plan also generally keeps the IRS from moving on to a final notice and a levy.
Call us with your latest IRS letter and we’ll work out the same comparison for your balance.
Payment plan defaulted? We can help you ask the IRS to reinstate or revise it.
If you missed payments, or filed a new return with a balance you could not pay, the IRS sends a CP523 notice saying it intends to terminate the installment agreement, and collection can resume 30 days later. The IRS allows a defaulted plan to be reinstated, for a fee. If your income dropped, the monthly payment can be revised, and if this year added a new balance, it has to be added to the existing agreement, because the IRS puts every balance you owe into the one plan. Revising a payment plan costs $10 online or $89 by phone or mail. We can answer the CP523 for you, ask the IRS to reinstate or revise the plan at a payment that fits your income now, and set up direct debit, so a payment is not missed by accident again.
What does IRS payment plan help cost?
We quote the fee on the first call, so you know the cost before any work starts. It depends on the size of the balance and the complexity of your file: the number of tax years involved, self-employment income, a levy or wage garnishment already in place, a lien already filed, and a penalty abatement request that needs a written reasonable-cause argument. One fee covers the work described above, including the penalty relief request where you qualify. Unfiled years are quoted separately, on the same terms as our back-taxes work, and they come first, because the IRS will not approve a payment plan until they are in. The IRS charges its own setup fee on top, from $22 to $178 depending on how the request is made and how you pay, and waives it for low-income taxpayers on direct debit.
What we need from you to request your payment plan
The sooner we have these, the sooner your request can go to the IRS. Once we have them, we send the request within a few business days. A request made online gets an immediate answer from the IRS, and one that has to go by mail takes about 30 days.
For every payment plan:
- The signed power of attorney we send you (Form 2848)
- The most recent IRS letters, front and back
- A copy of your last filed return, if we did not prepare it
- The routing and account number for the bank account you want to pay from, for the direct debit agreement (Form 433-D)
- The most you can comfortably pay each month
For a balance over $50,000, the Form 433-F adds:
- Three months of statements for every bank and investment account
- Your last two pay stubs, and your spouse’s
- Your mortgage or rent, vehicle loan, and credit card statements
- Monthly health insurance, out-of-pocket medical, child care, and any court-ordered payments
- A current profit and loss statement if you are self-employed
Live outside New Hampshire? We work with clients in every state.
A balance owed to the IRS is handled under the same federal rules in every state, and our license to represent taxpayers before the IRS covers all fifty. Everything happens by phone, video, and secure portal: you sign the power of attorney and upload your letters and documents, and we speak to the IRS for you from there. Clients in New Hampshire are also welcome at our office in Bedford. This service covers what you owe the IRS. If you also owe your state, its revenue department runs its own payment plans under its own rules.
Can we help with your balance?
We can help if you are an individual or a sole proprietor, you owe the IRS up to about $100,000, and paying the full amount over time is realistic. If your balance is larger than that, if the numbers show you cannot pay it in full within the IRS collection window, or if the debt is unpaid payroll tax from a business that is still operating, the right tool is a partial payment installment agreement or an offer in compromise, which is a different and much longer engagement. We will tell you that on the first call and point you to the kind of help that fits, so you do not pay us for work that will not solve your problem.
If you have years you never filed, start with back taxes and unfiled returns, because those returns have to be in before the IRS will approve a payment plan. If the letter in your hand is the first you have heard of a balance, and you are not sure it is right, read how we answer IRS notices; it is better to challenge a wrong balance than to agree to pay it. That applies most to a CP2000 notice, which proposes extra tax the IRS has not yet assessed. And if the balance came from a return that can be corrected, an amended return may shrink it before we ask for a plan.
Frequently asked questions
If I owe the IRS, can I make payments?
Yes. If you owe taxes you cannot pay at once, the IRS lets you pay monthly under an installment agreement, which most people call an IRS payment plan. If you can clear the balance within 180 days, a short-term payment plan has no setup fee. If you need longer, a long-term payment plan spreads the balance over years. Either way, every required return has to be filed first.
Can an IRS payment plan stop a levy or wage garnishment?
In most cases, yes. From the moment a payment plan request is pending, the IRS is generally barred from issuing a new levy, and the bar continues while the plan is in effect and you keep paying. If a wage garnishment or bank levy is already running, entering a payment plan is one of the listed reasons the IRS releases it, unless the agreement says otherwise. That is why we take the files with a final notice or a levy first.
Can I set up an IRS payment plan online myself?
For a balance of $50,000 or less with every return filed, yes. The IRS online payment agreement application takes a few minutes and carries the lowest setup fee. People hire us when the balance covers several years, when a return is missing, when the amount looks wrong, when the balance is over $50,000 and a financial statement is required, or when they would rather have a licensed representative speak to the IRS for them. We tell you which applies on the first call.
Do I have to call the IRS to set up a payment plan?
Someone does, unless the plan can be set up online or by mailing Form 9465. Once you sign a power of attorney (Form 2848), that someone is us. We make the call to the IRS for you, answer its questions about your returns and your balance, and settle the monthly payment and the due date. You approve the payment figure before we agree to it.
How long can an IRS payment plan last?
A short-term payment plan lasts up to 180 days. A long-term payment plan can run as long as the IRS’s remaining collection period, which is generally 10 years from the date the tax was assessed. The guaranteed installment agreement for tax of $10,000 or less has to be paid within 3 years. A longer term means a smaller payment and more interest, so we help you choose the highest payment you can keep up.
What is the minimum monthly payment on an IRS payment plan?
The IRS sets no fixed minimum. For a balance of $50,000 or less, the payment has to clear the full balance, with the interest and penalties that keep accruing, before the collection period ends. If you leave the amount blank on Form 9465, the IRS divides the balance by 72 months. Above $50,000 the IRS works the payment out from your Form 433-F: your income minus the living expenses it allows.
What is the IRS interest rate on a payment plan?
The interest rate on an IRS payment plan is the same rate the IRS charges on any unpaid tax: the federal short-term rate plus 3%, reset every quarter and compounded daily. The late-payment penalty is cut in half while the installment agreement is in effect, from 0.5% to 0.25% a month, as long as the return was filed on time. Penalties already charged can sometimes be removed separately through First Time Abatement if your filing history is clean, and we ask for that alongside the plan whenever it applies.
Will the IRS file a tax lien if I set up a payment plan?
For balances of $50,000 or less, the IRS is not required to make a lien decision at all. For an IRS payment plan over $50,000, a lien determination is part of the review. If a lien notice was already filed before the plan, the IRS can withdraw it once you are on a direct debit installment agreement and meet its other conditions, which is one reason we recommend direct debit for most plans.
What happens if I miss a payment or default on my IRS payment plan?
The IRS sends a CP523 notice saying it intends to terminate the installment agreement, and you have 30 days to put it right before collection can resume. Paying the missed amount by the date on the notice is how you keep the plan. Filing a new return with a balance you cannot pay also defaults the plan, which is why we fix your withholding or estimated payments when we set the plan up. A plan that lapses can be reinstated, with a fee.
Can I get one IRS payment plan for multiple years of back taxes?
Yes, and it has to work that way: the IRS puts every balance you owe into a single installment agreement. Unfiled years have to be dealt with before that. The IRS denies a payment plan request if any required return is missing, so those returns are filed first and whatever they add to the balance goes into the same plan. We can help with both, the returns and then the payment plan, so you end up with every year filed and one monthly payment covering all of it.
Will the IRS keep my refund while I’m on a payment plan?
Yes. Any federal refund is applied to the balance until it is paid off, and the monthly payment is still due in full that month. It shortens the plan, but do not count on the refund as spending money while the balance is open.
How much does the IRS charge to set up a payment plan?
The IRS setup fee depends on how the request is made and how you pay. Online with direct debit it is $22. Online with any other payment method it is $69. By phone or mail the fees are $107 and $178. Low-income taxpayers, meaning adjusted gross income at or below 250% of the federal poverty level, get the fee waived on direct debit or reduced to $43 otherwise. A short-term payment plan of 180 days or less has no setup fee, and revising an existing plan costs $10 online or $89 by phone or mail.
What if the IRS rejects my payment plan request?
A rejection can be appealed. The IRS generally cannot levy for 30 days after it rejects a payment plan request, or while an appeal is being considered. The appeal goes through the Collection Appeals Program on Form 9423, within the time stated in the rejection letter, and the IRS recommends a conference with the manager first. Common reasons are an unfiled return, missing estimated payments, or a monthly payment too low to clear the balance in time, so we find the cause, help you fix it, and then appeal or resubmit for you.
Where to learn more
- IRS: Payment plans and installment agreementsThe IRS’s own page on short-term and long-term payment plans, setup fees, what happens while a request is pending, and how to avoid default.
- IRS: Simple Payment PlansThe $50,000 plan that needs no financial statement, who qualifies, and how long it can run.
- IRS Publication 594, The IRS Collection ProcessWhat each notice means, what a lien and a levy are, and every option when you cannot pay in full.
What clients say
Real reviews from real Southern NH clients
“I truly cannot say enough good things about my experience with Chris & Maria at NH Tax Advisors! I came to them with a rather daunting & messy self-employed tax situation, needing resolution for some previous years' filings.”
“We had an unexpected situation this tax season when our original accountant suddenly became ill and had to retire. My husband and I were scrambling to find someone new, especially so close to the deadline.”
“I had a great experience working with Chris Brown. He was incredibly easy to work with and always very reachable. He would respond within minutes or at most a few hours whenever I had a question.”
Have a tax question, or a return that needs filing? Call and talk to a licensed tax pro who will remember you next year.
Tell us what you are dealing with, and we will tell you what it takes to get it filed accurately.