How Do You Pay Installment Tax Payments to the IRS?


Quick Answer

To pay installment tax payments to the IRS, you must submit an application and be approved, explains the IRS. Installment payment plan qualifications include owing $50,000 or less in combined taxes, penalties and interest and filing all necessary tax returns. Installment plans are available for individuals and businesses.

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How Do You Pay Installment Tax Payments to the IRS?
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Full Answer

To apply for an individual installment agreement, you need your name, email address, date of birth, address, filing status and Social Security number, according to the IRS. Business owners need an Employer Identification Number, caller ID from notice, address and the assignment date of the EIN. An authorized representative for an individual or business owner can also apply for an installment payment plan.

You can decide how much you pay a month under your installment agreement, to a degree, notes TurboTax. It's best that you pay as much as you can each month and make extra payments as possible. If you don't give the IRS a monthly payment amount or if you offer too low of a payment, the IRS takes the amount you owe on your taxes and divides the number by 72 to figure your monthly payment amount.

Fees are required for setting up an installment payment plan, states the IRS. As of April 2015, the IRS charges $52 for a direct debit agreement and $120 for payments that aren't directly taken from a bank account. Taxpayers who are below a certain income level only have to pay a $43 fee.

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