Responding to IRS Collection Notices: Do You Qualify for an Installment Agreement?

Posted on in IRS Issues

Cook County IRS issues lawyer, IRS collection noticesWhether you are an individual taxpayer, are self-employed, or own a business that staffs employees, avoiding IRS issues begins with properly responding to any IRS collection notices you receive. Lagging in your response or simply ignoring the IRS all together guarantees trouble, especially when there are options available to you to help you settle your tax responsibilities.

Response Time Can Cost or Save You Money

Despite our best efforts, sometimes paying the amount we owe after we have filed our taxes is difficult. If you have received a collection notice of some kind, you either owe money, have a refund due to you, or the IRS requires more information from you regarding your return. Whatever the reason for your notice, it is important to respond to the IRS promptly to avoid any potential delays or problems with your return, which can result in costly fines and penalties. The general rule of thumb is this: The longer you wait to respond when the IRS contacts you, the more likely you will experience financial consequences. Do yourself a favor and avoid unnecessary fines, fees, or interest, and respond to the notice right away.

Qualifying for an Installment Agreement

When you are unable to pay what you owe in one large lump sum, you may qualify for a payment plan. You, the taxpayer, or your authorized representative (Power of Attorney) may apply for an installment agreement, which will allow you to pay what you owe in smaller amounts, over time.

You may qualify for a payment plan if:

  • You are an individual who owes $50,000 or less in combined tax, penalties and interest, and have filed all required returns. If you owe less than $100,000, you may also qualify for a short term agreement; or
  • You are a business owner who has filed all required returns, with a balance of $25,000 or less in combined tax, penalties and interest for the current year or last year's liabilities.

To apply, you will need to provide the IRS with some basic personal information, including your social security number or Employer Identification Number (EIN), the address attached to your most recent processed tax return, filing status, and date of birth.

For guidance with installment agreement requests or to address any of your tax return concerns, speak with a knowledgeable Cook County IRS issues lawyer today. Call the Law Offices of Eric G. Zelazny at 708-888-2299 for a special consultation.

Sources:

https://www.irs.gov/individuals/offer-in-compromise-1

https://www.irs.gov/individuals/online-payment-agreement-application

https://www.irs.gov/individuals/understanding-your-irs-notice-or-letter

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