Will I qualify to receive an installment agreement?

The IRS is going to look at several things to evaluate whether they will grant you an Installment Agreement.

They are going to look at your current filings.

Have all of your tax returns been filed up to this date? If the answer is yes, they will proceed forward.

Then the IRS is going to check if you have the ability to pay from the assets that you own.

If you have the assets to pay the tax that you owe, the IRS wants to be seen as the lender of last resort, not the lender of first resort.

Next they are going to determine if you have the ability to pay based upon your monthly income and your monthly allowable expenses.

If your monthly income exceeds your monthly expenses,the difference is what the IRS is going to determine you can afford to pay. If you can pay that, the IRS will grant you an installment agreement.

There are some instances, where monthly income equals allowable expenses or monthly expenses exceed monthly income.

If that’s the case then you do not have the ability to pay.

The IRS will not grant you an installment agreement if your allowable monthly expenses exceed your monthly income. They’re going to look at your situation and ask where is the money going to come from to pay the installment agreement, and rightfully so.

You might say that you want an installment agreement and fully intend to pay, but if money is that tight they know that by granting you an installment agreement, you’re not going to be able to honor that installment agreement for very long.