What is an Installment Agreement?

Many solutions that I put into place for my clients involve an Installment Agreement, which is an agreement between you, the taxpayer, and the IRS to pay them off on a monthly basis.

It’s like an installment loan or a credit card loan. Once the IRS agrees to settle your debt in an Installment Agreement, you have an obligation to pay them the agreed-upon amount on a monthly basis until the tax is paid off or the statute of limitation occurs, whichever comes first.

An Installment Agreement is when the IRS is effectively loaning you the money to pay them off.

It’s a formal agreement that the IRS will accept to release a wage or bank levy.

Although I’m sure the IRS would rather not be in the position of having to accept money on an Installment Agreement, it is a perfectly acceptable way to solve one of your tax problems. In an Installment Agreement, you agree to pay the IRS a specified monthly amount in satisfaction of your debt.