Will I qualify for an Installment Agreement?

The answer to that, like most things in life, is it depends.

To determine whether you qualify for an installment agreement, the IRS is going to look at some financial information from you and your family.

Specifically, they are going to look at your family’s monthly income versus your family’s monthly allowable expenses.

By allowable expenses, this mean things like food, clothing, and miscellaneous; housing and utilities; ownership of a vehicle; operating cost of a vehicle; health insurance, if you have any; out-of-pocket health expenses; court-ordered payments; and of course the IRS’s favorite, there’s an allowance for taxes, assuming that you’re paying them.

The IRS takes your monthly income and compares it to your monthly allowable expenses. They’re not necessarily going to allow 100% of your expenses because there are maximum allowable standards. If you’re above that, they’re only going to allow the maximum, according to pre-defined standards.

But if they look at your monthly income versus your monthly expenses and they are the same, then you’re really not going to qualify for an installment agreement, because you have no ability to pay

If the monthly income is above the monthly expenses, generally speaking you’re going to qualify for an offer in compromise and the amount that you’re going to pay on a monthly basis is the excess of monthly income over allowable monthly expenses.