How Do You Arrange a Monthly Payment Plan With the IRS?


Quick Answer

As of 2015, taxpayers owing less than $50,000 can set up monthly payments by submitting IRS Form 9465, Installment Agreement Request, through the IRS website. Those paying their balance within 120 days use the Online Payment Agreement application. Taxpayers who owe more than $50,000 submit Form 433F, Collection Information Statement.

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How Do You Arrange a Monthly Payment Plan With the IRS?
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Full Answer

Taxpayers who need only short-term arrangements, meaning those lasting no more than 120 days, can also call the IRS at the phone number listed on their most recent tax notice, says the IRS. For such arrangements, taxpayers generally do not need to pay fees.

To qualify for monthly, longer-term online payments, a taxpayer must owe $50,000 or less, and a business must owe no more than $25,000, explains the IRS. A taxpayer or business must also be up-to-date on all tax return forms. The application entails providing contact data and other information. Taxpayers can pay via direct debit and possibly bypass credit-damaging tax liens. A taxpayer must pay several fees before proceeding with a payment plan, although the direct debit agreement fee is slightly lower for taxpayers who make less than a specific amount.

The IRS says that taxpayers should consider getting a loan if they cannot pay their bills in full; the interest rate for the loan may be lower than what a taxpayer would spend in IRS interest and penalties.

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