IRS Installment Agreements
Can't afford to pay your tax debt in full? An installment agreement lets you pay it off over time with affordable monthly payments.
Get Help Setting Up a Payment Plan
Types of IRS Payment Plans
The IRS offers several types of installment agreements. We'll help you find the right one.
Guaranteed Installment Agreement
If you owe $10,000 or less and can pay it off within 3 years, the IRS must accept your payment plan request.
- Automatic approval
- No financial disclosure required
- Up to 36 monthly payments
Streamlined Installment Agreement
For debts between $10,000 and $50,000, you may qualify for streamlined processing with minimal documentation.
- Simplified application
- Up to 72 monthly payments
- No tax lien for balances under $25,000
Partial Payment Installment Agreement
If you can't pay the full balance even with an extended payment plan, you may qualify to pay less than you owe.
- Based on what you can afford
- Remaining balance may expire with the statute
- Requires financial disclosure
Non-Streamlined Installment Agreement
For larger debts over $50,000, we'll negotiate directly with the IRS to establish affordable monthly payments.
- For large tax debts
- Full financial analysis
- Custom negotiated terms
Benefits of an Installment Agreement
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Stop Collection Actions
Once your agreement is in place, the IRS will stop levies and garnishments.
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Affordable Payments
Pay what you can afford each month instead of the full balance at once.
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Reduce Penalty Accrual
The failure-to-pay penalty is reduced by half while you're in an installment agreement.
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Peace of Mind
Know exactly what you owe each month and take control of your tax debt.
Why Hire a Professional for Your Payment Plan?
Many taxpayers assume setting up a payment plan is straightforward — and sometimes it is. The IRS offers online applications through their website for smaller balances, and some taxpayers can resolve their debt with a few clicks.
But for most taxpayers we work with, the situation is more nuanced. The IRS uses standardized formulas to determine your monthly payment, and those formulas don't always account for your real financial picture. A payment amount that seems "affordable" on paper can be devastating in practice — especially when you factor in penalties and interest that continue accruing while you pay.
As an Enrolled Agent with years of experience negotiating installment agreements, we know how to present your financial information in a way that results in the lowest legitimate payment amount. We understand which expenses the IRS allows, how to document them properly, and when to push back on an unreasonable determination. The difference between a self-negotiated agreement and one handled by a professional can be hundreds of dollars per month.
The bottom line: The IRS is not looking out for your best interest when calculating your payment. We are. Every dollar we save you monthly adds up to thousands over the life of your agreement.
State Tax Payment Plans
If you owe state taxes in addition to federal, you likely need separate payment arrangements with your state tax authority. State installment agreements vary widely — some states have online portals similar to the IRS, while others require paper applications and fax submissions.
Some states are significantly more aggressive than the IRS when it comes to collecting past-due taxes. States like California, New York, and Colorado have sophisticated collection systems and can suspend your driver's license or professional licenses for unpaid tax debt. Others may only grant one payment plan in your lifetime — default on it, and you may never get another chance.
We've negotiated payment plans with state tax authorities across all 50 states and understand the unique requirements and challenges each one presents. Whether you owe the IRS, your state, or both, we can coordinate your agreements to ensure they work together and fit your budget.
Frequently Asked Questions
Why should I hire a tax professional instead of setting up a payment plan on IRS.gov myself?
The IRS online payment tool works well for simple situations — balances under $50,000 with straightforward finances. But the tool calculates your payment based on paying the full balance before the collection statute expires, which often results in a higher monthly payment than necessary. A tax professional can negotiate terms that account for your actual living expenses and financial hardship, potentially securing a partial payment installment agreement or a lower monthly amount than the IRS would offer through self-service channels.
If I get on a payment plan, do the penalties and interest stop?
Unfortunately, no. Interest continues to accrue on the unpaid balance for the life of the agreement, and the failure-to-pay penalty continues as well — although it is reduced by half (from 0.5% to 0.25% per month) while an installment agreement is in effect. This is one reason why the total amount you end up paying can be significantly more than your original tax debt. We help clients understand the true cost of different agreement types and explore whether options like an Offer in Compromise might save more money in the long run.
What happens if I miss a payment on my installment agreement?
Missing a payment can result in the IRS defaulting your agreement, which reinstates the full failure-to-pay penalty rate and reopens collection activity including wage garnishments and bank levies. The IRS typically sends a notice before defaulting your agreement, giving you 30 days to respond. If you anticipate difficulty making a payment, contact us immediately — we can often renegotiate the terms or request a temporary modification before the agreement goes into default.
How long does it take to set up an IRS payment plan?
For guaranteed and streamlined agreements (balances under $50,000), approval can happen within days. For larger debts requiring a non-streamlined or partial payment agreement, the process involves submitting detailed financial documentation (Form 433-A or 433-F), which the IRS may take 30-90 days to review. During this time, we can request that the IRS hold off on collection actions while your application is pending.
Can I modify my installment agreement if my financial situation changes?
Yes. If your income decreases or your expenses increase significantly, you can request a modification of your agreement. Conversely, the IRS may also request you to update your financial information and increase your payment if they believe your ability to pay has improved. We help clients navigate modifications in both directions — reducing payments when hardship occurs, and protecting against unreasonable IRS demands for higher payments.
Is it easy to set up a payment plan with my state tax authority?
It depends on your state. Larger states like California, Colorado, and New York have online portals and processes similar to the IRS. Smaller states may require paper applications sent by mail or fax. Some states are more lenient than the IRS about payment terms, while others are more rigid. In certain states, failing to maintain a payment agreement can result in driver's license suspension or revocation of professional licenses — consequences the IRS doesn't impose. We know the nuances of each state's program and can help ensure you avoid costly pitfalls.
What is a Partial Payment Installment Agreement (PPIA)?
A PPIA allows you to make monthly payments that are less than what would be needed to pay off your full balance before the 10-year collection statute expires. This means a portion of your debt may ultimately expire without being paid. PPIAs require detailed financial disclosure and are reviewed by the IRS every two years, but they can be an excellent strategy for taxpayers who can't afford a full-pay agreement but don't qualify for an Offer in Compromise.
Related Tax Relief Services
An installment agreement isn't always the best option. Depending on your situation, these services may help:
Offer in Compromise
Settle your IRS debt for less than you owe. If you can't afford to pay the full balance even over time, an OIC may be a better path.
Currently Not Collectible
If you can't afford any payment right now, CNC status pauses IRS collections and lets the statute of limitations continue running.
Penalty Abatement
Reduce the total amount you owe by removing IRS penalties, making your installment agreement payments lower and more manageable.
Set Up Your Payment Plan Today
Let us negotiate the best possible payment terms with the IRS on your behalf.