Don’t Sweat the Debt: How Long Will the IRS Give You to Pay Back Taxes?

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If you’re having trouble paying your income taxes, you might be eligible for an installment plan offered by the Internal Revenue Service. The minimum monthly payment for your plan depends on how much you owe.

If you are unable to pay your taxes, you might be eligible for an Internal Revenue Service (IRS) installment plan.

Form 9465 can be submitted to the IRS via mail, phone, or online to apply for an installment agreement.

Taxes – the bane of every working individual’s existence. We all know they’re necessary, but that doesn’t make them any less painful. And when life throws you a curveball and you find yourself unable to pay your taxes on time, the stress can feel overwhelming. But fear not, fellow taxpayer! The IRS isn’t as heartless as you might think. They understand that sometimes, things happen, and they’re willing to work with you to find a solution.

So, how long will the IRS give you to pay back taxes? Well, it depends. Generally, they’ll offer you up to six years to pay. However, if you can’t afford the minimum payments on a 72-month payment plan, you can stretch out your payments to the collection statute expiration date (CSED). The CSED is 10 years after the tax assessment.

Here’s a breakdown of your options:

Short-Term Payment Plan (180 Days or Less)

  • Available to individuals only
  • Apply online or by phone
  • No setup fee
  • Pay in full within 180 days
  • Accrued penalties and interest still apply

Long-Term Payment Plan (Installment Agreement)

  • Available to individuals and businesses
  • Apply online, by phone, or by mail
  • Setup fee applies (varies depending on application method and income)
  • Pay in monthly installments
  • Accrued penalties and interest still apply

Offer in Compromise (OIC)

  • Available to individuals and businesses facing significant financial hardship
  • Allows you to settle your tax debt for a lower amount
  • Requires extensive documentation and justification
  • May not be approved

Currently Not Collectible (CNC)

  • Available to individuals and businesses facing temporary financial hardship
  • Suspends collection efforts until your financial situation improves
  • Requires annual review and recertification
  • Accrued penalties and interest still apply

Remember, the IRS wants to work with you, not against you. They understand that financial difficulties can happen to anyone. So, if you find yourself unable to pay your taxes on time, don’t hesitate to reach out to them. They’ll help you explore your options and find a solution that works for you.

Here are some additional tips for dealing with the IRS:

  • File your taxes on time, even if you can’t pay. This will help you avoid additional penalties and interest.
  • Contact the IRS as soon as possible if you can’t pay your taxes. The sooner you contact them, the more options you’ll have.
  • Be honest and upfront with the IRS about your financial situation. They’ll be more likely to work with you if they know you’re being truthful.
  • Keep good records of your income and expenses. This will help you support your claim of financial hardship.
  • Consider hiring a tax professional to help you navigate the process. They can help you understand your options and file the necessary paperwork.

Don’t let tax debt stress you out. The IRS is there to help you find a solution. You can collaborate with them to settle your tax debt and get back on your feet by acting and being transparent with them.

Additional Resources:

Balance between $10,000 and $50,000

With a balance due above $10,000, you can qualify for a “streamlined” installment plan. With a streamlined plan, you generally have 6 years (72 months) to pay. If you owe $25,000 to $50,000, you must agree to pay by direct debit or payroll deduction.

While acceptance isnt guaranteed, the IRS doesnt usually require additional financial information to approve these plans. However, if you cant pay an amount equal to what you owe divided by 72, you will need to complete Form 433-F unless you qualify for an exception.

Qualifying for a plan with a higher balance due requires additional information. For instance, you must use Form 9465 to apply (i. e. , you cant apply online or by phone). Additionally, you have to file Form 433-A, which requires you to submit comprehensive details about your assets, income, employment, bank accounts, investments, and more.

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~37% of taxpayers qualify. Form 1040 + limited credits only.

Fees for IRS installment plans

Setting up an installment plan won’t cost you anything if you can pay off your balance in 180 days.

Establishing a direct debit payment plan online will cost $31, or $107 if the plan is set up over the phone or by mail, if you are unable to pay off your balance within 180 days.

Setting up the plan online will cost $130 if you’re not using direct debit, and it will cost $225 if you set it up over the phone or by mail.

If youre a lower-income taxpayer, you may be able to reduce these fees.

I Owe the IRS $55,000 in Back Taxes

FAQ

How many months will IRS do payment plans?

Long-term payment plan (also called an installment agreement) – For taxpayers who have a total balance less than $50,000 in combined tax, penalties and interest. They can make monthly payments for up to 72 months.

How long will the IRS give you to pay back taxes?

The IRS generally has 10 years – from the date your tax was assessed – to collect the tax and any associated penalties and interest from you. This time period is called the Collection Statute Expiration Date (CSED).

How many years can IRS go back to make you pay taxes?

Generally, the IRS can include returns filed within the last three years in an audit. If we identify a substantial error, we may add additional years. We usually don’t go back more than the last six years.

What happens if I owe the IRS and can’t pay?

Payment options The IRS may be able to provide some relief such as a short-term extension to pay (paid in 120 days or less), an installment agreement, an offer in compromise, or by temporarily delaying collection by reporting your account as currently not collectible until you are able to pay.

How long does the IRS keep your tax refund?

The IRS will also keep your future refunds until you’ve paid the taxes. The IRS has 10 years to collect back taxes–called the collection statute of limitations. During this time, the IRS will try repeatedly to collect.

How long do I have to pay taxes if I owe?

The deadline for paying personal income taxes for the 2022 tax year to the IRS is **April 18, 2023** . Even if you apply for an extension to file your return, you’ll need to pay an estimate of

How long do I have to pay my tax balance?

The IRS will provide up to 120 days to taxpayers to pay their full tax balance. Fees or cost: There’s no fee to request the extension. There is a penalty of 0.5% per month on the unpaid balance. Action required: Complete an online payment agreement, call the IRS at (800) 829-1040 or get an expert to handle it for you.

Do you owe back taxes?

Call (855) 357-8933 today. What are back taxes? Back taxes are simply money that you owe to the IRS. There are many causes of owing the IRS, including not having enough taxes taken out of your paycheck, or not making required estimated tax payments. If you have new sources of income like a side hustle or investment gains, you may owe taxes.

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