The most common IRS payment plan is an Installment Agreement. This tax debt payment plan is widely popular due to most taxpayers being eligible for one of its various types. Under this payment plan, taxpayers can pay their debt amount in fixed monthly payments in order to fulfill their tax debt amount. The IRS charges interest and penalties on the debt amount that remains to be paid, even after a taxpayer has begun payment under the agreement.
Taxpayers that cannot pay the entire amount of the tax debt in a lump sum and have the financial capacity to pay the entire tax debt amount choose Installment Agreement payment plan. Those taxpayers whose financial capability does not allow them to pay the tax debt amount in full can pay a reduced amount in payments under a Partial Payment Installment Agreement.
There are many kinds of Installment Agreements to help taxpayers pay their tax debt comfortably. Before applying for a payment plan, taxpayers must consider consulting a tax professional or a tax service company. It will help them avoid mistakes and resolve their tax debt smoothly and successfully.
It is important for taxpayers to resolve their tax debt early to avoid aggressive IRS collection actions, and the accumulation of interest and penalties. Tax debt resolution can be simple and straightforward if taxpayers use an appropriate IRS debt payment plan for the resolution.