IRS expands testing of new payment options for delinquent taxpayers

Last year, the IRS announced that it was testing expanded criteria for streamlined processing of taxpayer requests for installment agreements. When taxpayers owe money to the IRS and it is not possible or feasible to pay the balance due all at once, they may qualify for an Installment Agreement (IA), which permits payment over time. The IRS already allows streamlined processing of IA’s in limited situations but has been evaluating whether to permit it in more cases. The testing period was supposed to end on September 30th, 2017. It has now been extended to September 30th, 2018.

The IRS already allows qualified individual taxpayers to use the IRS’s Online Payment Agreement application. Taxpayers can request an installment agreement and set up a payment plan electing the direct debit method of payment.

Streamlined processing is being tested in cases where individual taxpayers have an assessed balance of tax, penalty, and interest between $50,000 and $100,000. This will occur if the taxpayers’ proposed monthly payment is the greater of: (i) their total assessed balance divided by 84; or (ii) the amount necessary to fully satisfy the liability by the Collection Statute Expiration Date. The goal is to determine whether the expansion of streamlined processing criteria to taxpayer installment agreement requests will improve customer service, reduce taxpayer burden, and increase agency efficiency.

Test criteria will be applied to installment agreement requests submitted through SB/SE Campus Collection Operations, including the Automated Collection System (ACS), Automated Collection System Support (ACSS), and Compliance Services Collection Operations (CSCO). This test will not be applied to accounts worked by Field Collection revenue officers or Taxpayer Assistance Center employees.

For more information on all the criteria being tested, visit the IRS website.

Before applying for any payment plan, taxpayers must meet certain requirements. If you owe back taxes, we can help you evaluate your options and help to negotiate an installment payment plan. Contact us for a consultation.