- March 15, 2020
- Posted by: Crystal Larsen
- Category: IRS Payment Plans
An IRS payment plan can help millions of Americans struggling to pay their tax debts. But, most don’t realize there’s help available with payment plans. At the same time, the IRS spends millions every year on tax collection efforts, adding to the country’s deficit. So, why are taxpayers across the country fighting with the IRS instead of applying for a payment plan? Because most Americans just don’t realize that tax resolution services exist to help. One of the tax resolution services available to help with debt relief is IRS payment plans. Through a payment plan, taxpayers and the IRS can save money. And at the end of the day, saving on both ends is good for the financial health of the country. So, are you ready to figure out how an IRS payment plan can get you out of tax debt? If so, keep reading.
What is An IRS Payment Plan?
IRS payment plans are agreements you make with the IRS to pay the taxes you owe within a certain timeframe. Request an IRS payment plan if you can pay the taxes in full within a certain amount of time. There may be fees involved in IRS payment plans, which we’ll explain later. If you request a short-term payment plan, you won’t have to pay any fees. Failing to pay your taxes can result in several collections actions from the IRS. So, if you know in advance you won’t be able to pay, act right away. Contacting a tax resolution services firm can save you a lot of time and stress with the IRS.
Short-Term IRS Payment Plans
A short-term IRS payment plan is an agreement to pay your tax debt within 120 days. It costs $0 to apply for a short-term IRS payment plan. You can apply online, by phone, mail or in-person. The IRS allows you to satisfy your short-term IRS payment plan in the following ways:
1. Paying via automatic withdrawals from your checking out
2. Submitting a check, money order for the amount you owe
3. Paying via a debit or credit card
To qualify for a short-term payment plan, your tax debt cannot exceed $100,000. The total tax debt includes any interest and penalties you accumulate.
Long-Term IRS Payment Plans
If you want more than 120 days to pay off your tax debt, you can apply for a long-term plan. And, there are fees involved in applying for a Long-Term Internal Revenue’s Payment Plan. Fees you may incur if you set up automatic withdrawal payments include:
1. $31 to apply online
2. $107 to apply by phone, mail or in-person
3. If you’re a low-income applicant, the IRS may waive this fee
If you choose to pay tax debts through another method, like a check or money order, fees include:
1. $149 to apply online
2. $225 to apply by phone, mail or in-person
3. If you’re a low-income applicant, the IRS can reduce your fee to $43. You also may get reimbursement for this fee under special circumstances.
To qualify for a long-term IRS payment plan, you must have at least $50,000 in tax debt. This debt includes the tax you owe, plus penalties and interest.
How Do I Qualify As A Low-Income Applicant?
Taxpayers qualify as low-income applicants if their adjusted gross income is at/below 250% of the federal poverty level. For low-income taxpayers, the IRS waives user fees if you make automatic withdrawal payments. If you do not make automatic payments, the IRS will reimburse you for the fee after you pay your balance.
Paying IRS Payment Plans with Credit Card
If you plan to pay your IRS payment plan balance with a credit card, there will be a processing fee.
1. For debit cards, you will pay approximately $2 to $4 per payment.
2. When paying with credit cards, there is an approximate 2% charge.
If you owe more than $25,000 in taxes, you must make payments via automatic withdrawals. While it may seem easy to pay your IRS payment plan with a credit card, remember the dangers of credit card interest. If you don’t pay off your credit card debt quickly, it will accumulate overtime. Sometimes, paying with a credit card gets you into even more financial debt. Make sure you can afford to pay the IRS payment plan payments you agree on.
What Are The Benefits of an IRS Payment Plan?
When you’re drowning in tax debt, any relief is good. A tax resolution services firm can offer you several options for tax relief. But, when you want to pay your debt in affordable payments, an IRS payment plan is the way to go. An IRS payment plan is a convenient way to pay off back taxes because it doesn’t put extra strain on your budget. Many Americans opt for a payment plan because it helps them keep up with their tax bills. And, when you’re enrolled in a payment plan, the IRS reduces its Failure to Pay penalty.
What is the Minimum Monthly Payment for an IRS Payment Plan?
Working with a tax resolution services company can help you negotiate an affordable minimum monthly payment. The IRS will usually ask you what you can afford to pay per month. You should try and pay as much as possible to reduce your interest and penalties. A tax resolution services representative can help you determine the right monthly payment amount for you. There could be downsides for trying to determine how much you can pay on your own. The IRS will take the amount you own and divide it by 72 if:
– You don’t give them an answer on how much you want to pay
– The amount you select is too low
– You let the IRS pick the payment amount for you
For the reasons above, a tax resolution services specialist should help you in determining your monthly payment amount.
Getting Help from A Tax Resolution Services Company
When you’re attempting to negotiate with the IRS, have a tax resolution services specialist on your side. A tax resolution services specialist knows the IRS better than anyone. Because a tax resolution services specialist can negotiate a better deal for you with the IRS, they can be a great tool. If you’re considering an IRS payment plan to pay off debt, call a tax resolution services company. Make sure the tax resolution services company has experience dealing directly with the IRS. Los Angeles tax resolution services company Platinum Tax Defenders has years of experience dealing with the IRS. The tax resolution services team at Platinum has collectively saved their clients hundreds of thousands in tax debt. If you’re looking for help from a tax resolution services company, call Platinum Tax Defenders.
Need Help Applying for a Payment Plan? Call Platinum Tax Defenders
The experts at Platinum Tax Defenders can help you set up your IRS payment plan. Whether you owe $25,000 or $100,000, we have the tax resolution services experience you need. Our team of tax attorneys and enrolled agents have years of experience dealing directly with the IRS. When setting up an IRS payment plan, we make sure we negotiate a monthly payment amount that works for you. In the event that an IRS payment plan isn’t right for you, we offer other tax resolution services. Our goal is to help you get back in good standing with the IRS. Failing to pay your taxes can produce a financial headache if not taken care of. So, our team ensures you get the tax resolution services you need to succeed. Call us today for a free consultation.