” If you cannot pay your tax liability in full, request for an installment agreement.”
IF you cannot pay your tax liability in full, request for an installment agreement. Here are some tips when and when not an examiner is able to set-up an installment agreement.
The examiners are authorized to set-up for installment agreement if unpaid tax liabilities is within the dollar threshold as follows:
• Guaranteed installment agreement per IRM 188.8.131.52: For individuals with income tax liabilities of $10,000 and below, excluding penalties and interest, and payment is within 36-months.
• Streamlined installment agreement per IRM 184.108.40.206: For taxpayers with income tax liabilities of $50,000 or less, excluding penalties and interest, and payment is within 72-months. The examiner may direct the taxpayer to apply for online payment agreement if all the required income tax returns filings are met.
Tax liabilities more than $50,000, the examiners are not authorized to set-up installment agreement.
• Non-streamlines installment agreement per IRM 220.127.116.11. This procedure applies if the amount of tax liabilities is between $50,001 and $100,000. You will be required to submit 1) Form 9465, installment agreement, and 2) Form 433-B collection information statement for business or Form 433-F collection information statement.
• Coordination with collection per IRM 18.104.22.168 and IRM 22.214.171.124. If unpaid tax liabilities is more than $100,000, a collection referral is mandatory. The examination group manager, territory manager and collection territory manager will contact and coordinate for proper contact of collection group.
Do not be surprised if you owe more than $100,000 and applied for installment agreement and your case has been moved from one location to another location, from one agent to another agent, this is because it has to be assigned to a proper collection group.
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Disclaimer: Any accounting, business or tax advice contained in this communication is neither intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.
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Al-os & Associates Accountancy Corporation provides accounting and tax services to individuals, corporations, LLCs and business entities. The Firm has a niche in defending taxpayers audited by the IRS and other governmental agencies.