I focus my practice on tax resolution, representing taxpayers in Colorado, Florida, and across the United States. An IRS partial pay installment agreement is a payment plan that allows taxpayers to pay off their tax debt in smaller, more manageable monthly payments. Unlike a traditional installment agreement, a partial pay installment agreement allows taxpayers to pay less than their full tax debt over a longer period of time.
To qualify for a partial pay installment agreement, taxpayers must first submit a financial statement to the IRS, which outlines their income, expenses, and assets. The IRS will then review the financial statement and determine if the taxpayer is eligible for a partial pay installment agreement.
If approved, taxpayers will be required to make monthly payments towards their tax debt. The amount of the monthly payments will be based on the taxpayer's ability to pay, as determined by the IRS. The payments will continue until the tax debt is paid off in full, or until the statute of limitations on the tax debt expires.
One of the benefits of a partial pay installment agreement is that it allows taxpayers to pay off their tax debt without having to incur additional penalties and interest. In addition, taxpayers who enter into a partial pay installment agreement may be able to avoid more drastic collection actions, such as wage garnishment or bank levies.
However, it is important to note that a partial pay installment agreement may not be the best option for everyone. Taxpayers who are able to pay their tax debt in full within a shorter period of time may benefit from a traditional installment agreement or an offer in compromise, which allows taxpayers to settle their tax debt for less than the full amount owed.
In conclusion, an IRS partial pay installment agreement can be a useful tool for taxpayers who are struggling to pay off their tax debt. However, it is important to consult with a tax professional to determine if a partial pay installment agreement is the best option for your specific financial situation.