The IRS requires that back taxes are paid ASAP. Individuals or businesses which find themselves unable to pay any or all of the tax owed should file an installment agreement as soon as possible. Installment agreements allow for full payment of your tax debt in smaller amounts over a period time. To be eligible for an IRS installment agreement, all returns that are due (or overdue) must first be filed. Installment agreements generally require equal monthly payments. The amount of each installment payment will be based on the amount of back taxes owed and consideration is given to the taxpayer’s ability to pay that amount within the time available for the IRS to collect. By law, the IRS has the authority to collect outstanding back taxes for ten years from the date of the tax assessment. The advantage of an Installment Agreement is that no enforced collection takes place while the taxpayer is on the plan (provided the client doesn’t default). Be aware that with an Installment Agreement interest and penalties continue to accrue over time.
Now, there is an IRS form to automatically set up the plan with approval without ever speaking to the IRS. At Sandra King Financial Services we will prepare this form for you with the IRS guidelines in hand to help you resolve this debt with the least amount of anxiety or impact on your family.