Taxes are due in just a few weeks, which means you may be looking for ways to deal with your tax debt when you can’t afford it outright. If you are struggling with tax debt, an installment agreement from the IRS can help you manage it in a way that is best for your financial situation. An installment agreement allows you to pay your taxes over a set period of time.
You can make payments on a monthly basis via direct debit, check, money order, or electronic funds transfer. This type of arrangement is beneficial because it allows you to spread out the cost of paying off your tax debt and make manageable payments each month instead of making one large payment all at once.
Am I Eligible for an Installment Agreement?
Applying for an IRS installment agreement can be a great way to break down large tax bills into smaller, more manageable payments. To qualify for an installment agreement, there are certain criteria and documentation that you must provide.
First, you need to have filed all of your required tax returns for the past five years in order for the IRS to consider your application. If you have not filed all of your taxes, then it is important to do so before applying for an installment agreement.
The second requirement is that you can demonstrate financial hardship. This means that you need to submit documents showing proof of income, such as recent pay stubs, bank statements, and other financial documents. The IRS will review these documents in order to assess your ability to make payments on the debt.
Finally, you must be able to show that you have enough money to make the monthly payments on the installment agreement. This means that other bills and expenses must be taken into account when determining how much of your income can go toward paying the taxes owed. If it is determined that you do not have enough money to cover your tax bill while still making regular payments on other debts, then the IRS may decide not to accept your application for an installment agreement.
Contact an Attorney for Help
Overall, an installment agreement from the IRS can be a great way to manage your tax debt while still staying within your budget. It allows you to make smaller, more manageable payments over time instead of paying off the full balance all at once which can be difficult if you have limited funds available.
With this type of arrangement, you can keep up with your payments without having to worry about additional fees or penalties from the IRS. So if you are struggling with tax debt, an IRS installment agreement may be just what you need to get back on track.
To learn more about how to pursue this option, contact Buchalter & Pelphrey Attorneys At Law today for help.