If you owe less than $25,000, the IRS will not place a pawn on your property. If you have debts in excess of $25,000, you can avoid notification through Federal Tax Link if you sign up for a debit contract. Fortunately, the Internal Revenue Service (IRS) has a program that allows taxpayers to pay taxes in monthly increments rather than in a large single package. If you are in this position, you can use the IRS to file a 9465 filing form: payment contract application. But remember that penalties and interest on the outstanding balance are still in place until you pay the taxes due. With a balance of more than $10,000, you can qualify for an optimized instalment plan. If you can pay your balance within 120 days, it won`t cost you anything to put in place a plan in installments. A payment plan is an agreement with the IRS to pay the taxes you owe in a longer period of time. You should apply for a payment plan if you think you can pay all of your taxes in the extended period. If you are eligible for a short-term payment plan, you are not responsible for a user fee. If you do not pay your taxes when they are due, this may lead to the filing of a notice on the Federal Link Reference and/or an IRS deposit share. See publication 594, THE PDF of the IRS collection process.
Robert E. McKenzie of the law firm Arnstein-Lehr LLP in Chicago, Illinois, has concentrated his practice in representation before the Internal Revenue Service and tax authorities. Previously, he was a member of the IRS Advisory Council (IRSAC), a group appointed by the IRS Commissioner from 2009 to 2011. He is the author of REPRESENTATION BEFORE THE COLLECTION DIVISION OF THE IRS. He is vice-president of the American College of Tax Counsel. If you have received the message from the IRS that you owe money and cannot afford to make a lump sum payment, you are not overwhelmed. You can set up an IRS rate agreement. Depending on the amount of debt, the agreement breaks on what you owe in monthly installments that work with your budget.
Individuals who are already making payments under a temperate agreement with the IRS are not authorized to use Form 9465 and should contact the IRS at 1-800-829-1040 when making arrangements for payment of additional amounts.