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Tax Debt Installment Agreements

December 23rd

There are generally considered to be five different ways of approaching a tax debt situation with the IRS, but the most common is to set up an installment agreement or repayment plan. Underneath the heading of installment agreements, there are four different types. What follows is a snapshot overview of the four different installment agreements people usually pursue when looking to pay off IRS debt.

Guaranteed Installment Agreements

If financially able, the best way to pay off IRS debt is through a guaranteed plan. The biggest benefit of using a guaranteed installment agreement is that the IRS will not be able to file a federal tax lien against you. Because of this, credit bureaus will not have any knowledge of your situation and it will not adversely affect your ability to obtain credit.

Streamlined Installment Agreements

If you can agree to pay off your tax debt balance in 72 months or less, and have a balance less than $50,000, the IRS will approve you for a streamlined installment agreement. Again, in this situation a federal tax lien will not be placed on you because of your tax debt.

Partial Payment Installment Agreements

This agreement is good for people who are not financially able to meet the minimum payments in the previous two agreements to pay off their IRS debt. Under this plan, you will be able to set up a longer payment period with monthly payments based on what you can afford.

Non-Streamlined Installment Agreements

Non-streamlined installment agreements are available if you cannot meet the requirements of the other three agreements. You will need to speak with an IRS agent to discuss your tax debt and financial situation and should seek out a tax lawyer to speak with the IRS on your behalf.


Understanding the Five Tax Debt Strategies

December 9th

Owe the IRS a substantial amount of money? Decided it is finally time to talk with a tax debt lawyer about your existing tax debt? The good news is that you have options when it comes to your situation. By speaking with a reputable tax debt lawyer, you can learn about the five different tax debt strategies often used by people in your same position. Here is a brief overview of the five strategies:

Installment Agreement

The installment agreement is simply a monthly payment plan for paying off your tax debt to the IRS. This is usually the easiest strategy available.

Partial Payment Installment Agreement

If you have some of the funds to pay back your tax debt, but not all, a tax debt lawyer may advise you to go with this strategy. Under this plan, you will set up a long term payment plan to pay off the IRS at a reduced amount.

Offer in Compromise

This is another option for those with the ability to pay back some of the tax debt, but not all. Under this strategy, you will make a lump sum or short term payment plan to pay off the IRS at less than the amount you owe.

Not Currently Collectible

This is an IRS program where they agree to not collect on your debt for a specified amount of time. A tax debt lawyer is likely to suggest this when the party does not have the financial ability to pay in the near future.

Filing for Bankruptcy

The final strategy is to simply file for Chapter 7 or 13 bankruptcy and discharge your tax debt under the applicable rules.


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