IRS Installment Agreement: Pay Your Tax Debt Over Time
If you owe taxes but cannot pay in full, an IRS installment agreement lets you spread the balance into affordable monthly payments. We set up the plan, negotiate terms based on what you can truly afford, and keep the IRS from escalating collection while you pay.
We will contact you to arrange a call about your situation, service scope, and pricing. Specific tax advice is provided under an engagement.
IRS payment plan help
What Is an IRS Installment Agreement?
An IRS installment agreement is a formal arrangement to pay federal tax debt in monthly payments. It can help individuals, self-employed taxpayers, and businesses address a balance they cannot pay at once. A full-payment plan spreads out the debt; it does not settle it for less or stop interest and applicable penalties.
Mraz Tax Solutions LLC helps clients in Orange County and nationwide compare payment options, prepare the required records, and communicate with the IRS. Qualifying taxpayers may apply directly through their IRS online account; our licensed Enrolled Agents help you work through larger balances, affordability concerns, unfiled returns, and collection notices.
Payment plans are part of our past-due tax and unfiled return services. If paying in full is not realistic, we also review whether an Offer in Compromise or hardship status may fit your circumstances.
Compare your options
Types of IRS Payment Plans
Your balance, type of tax debt, filing compliance, and available repayment time determine which options the IRS can consider. A higher balance does not automatically rule out an installment agreement.
Pay in 180 days or less
Short-Term Payment Plan
Individuals who owe less than $100,000 in combined tax, penalties, and interest may qualify to apply online. This is an extension of time to pay in full, rather than a long-term monthly installment agreement.
No IRS setup fee. Interest and applicable penalties continue until paid.
Monthly payments for individuals
Simple Payment Plan
Individuals with $50,000 or less in assessed tax, penalties, and interest may qualify without a collection information statement. All required returns must be filed, and you must stay current with new tax obligations.
Most qualifying taxpayers can pay over up to 10 years, subject to the applicable collection deadline and IRS terms.
Business tax balances
Business Payment Plans
Simple Payment Plans may cover up to $25,000 for businesses with trust fund taxes or $50,000 for businesses without them. Certain out-of-business sole proprietorships have a $50,000 threshold. Other arrangements may be available above these amounts.
Business taxpayers generally contact the IRS directly. Sole proprietors and independent contractors generally apply as individuals.
When standard terms do not fit
Financially Reviewed & Partial-Payment Plans
If the balance or required payment does not fit a Simple Payment Plan, we review income, assets, and allowable expenses. A Partial Payment Installment Agreement may apply when you can pay something but cannot fully pay before the collection deadline.
Financial disclosure is required for a partial-payment plan, with reviews generally every two years. Payments can change after review.
See the IRS guidance on Simple Payment Plan eligibility and terms. The collection period can be suspended or extended by certain events, so the remaining time must be reviewed for your account.
Understand the full cost
IRS Setup Fees, Interest & Penalties
The setup fee is only one part of the cost. Paying more upfront or making extra payments can reduce the interest and penalties added over time.
| Payment option | IRS fee |
|---|---|
| Short-term plan | $0 |
| Monthly plan with direct debit | $29 |
| Monthly plan without direct debit | $69 |
Phone, mail, or in-person monthly-plan setup is generally $107 with direct debit or $178 without it. These are IRS fees, separate from professional fees and any card-processing charges.
Qualifying low-income individuals at or below 250% of the applicable federal poverty level may receive a direct-debit fee waiver or other fee relief. We review the requirements and any request for reconsideration.
IRS fee schedule and low-income reliefInterest continues; penalty relief has conditions
Interest and applicable penalties continue until paid in full. For an individual who filed the return on time, the failure-to-pay penalty generally falls from 0.5% to 0.25% per month or partial month during an approved agreement. Failure-to-deposit penalties are not automatically reduced, and relief from earlier penalties is a separate question.
A levy restriction is not a lien release
Subject to exceptions, IRS levies are generally restricted while a request is pending or an agreement is in effect, and during applicable appeal periods. A plan does not automatically remove a lien or release an existing levy. We review any IRS notices and collection deadlines rather than assuming every action has stopped.
Refunds do not replace scheduled payments
The IRS generally applies future refunds to your tax debt. Continue making scheduled payments even when a refund is applied, and file and pay new taxes on time. Contact the IRS promptly if your circumstances change; a default or reinstatement can bring additional costs.
From review to repayment
Our Installment Agreement Process
Working with an Enrolled Agent means having a clear request, supporting documentation, and a point of contact for IRS correspondence. We explain both the proposed payment and the obligations that come with it.
Explore our tax preparation and IRS representation services-
Review your balance and options
We review IRS notices, tax years, income, expenses, and collection deadlines. We compare a full-payment plan, partial-payment agreement, Offer in Compromise, or hardship status based on your circumstances.
-
Bring filings and current payments up to date
We identify and prepare any required unfiled returns. We also review withholding, estimated taxes, and any required business tax deposits so a new balance does not undermine your agreement.
-
Prepare the appropriate request
We use the available online, phone, or paper process, including Form 9465 when appropriate. If financial disclosure is needed, we prepare the requested collection information statement and supporting records. With authorization, we communicate with the IRS on your behalf.
-
Confirm your payment terms
After approval, we review the monthly amount, due date, setup fee, and payment method. Direct debit is a payment method, not a separate eligibility category, and can lower setup costs and help avoid missed payments.
-
Keep the agreement on track
We help you review IRS correspondence and understand ongoing filing and payment requirements. If your income drops or a payment becomes unaffordable, we help you request a change rather than simply stopping payments.
Questions & answers
Frequently Asked Questions
Not sure whether a payment plan, settlement, or hardship status fits you best? We will review your options confidentially.
Request a free initial consultation What is an IRS installment agreement?
An IRS installment agreement is a payment plan that lets you pay your tax balance over time instead of in a single lump sum. A full-payment agreement requires you to pay the balance plus accruing interest and penalties. A partial-payment agreement follows different financial-review rules. The IRS generally restricts levies while an agreement is in effect and you remain compliant, but a plan does not automatically remove a tax lien.
How do I set up an installment agreement?
Individuals may qualify to apply online for a monthly plan with $50,000 or less in combined tax, penalties, and interest and all required returns filed. Sole proprietors and independent contractors generally apply as individuals. Other business taxpayers should contact the IRS using their notice or the business tax line. Form 9465 is an alternative for eligible individual requests; complex cases may require Form 433-F, 433-A, or 433-B and supporting financial records. Form 433-D documents an installment agreement; it is not a financial statement.
Will I still owe penalties and interest?
Yes. Interest and applicable penalties continue until the balance is paid in full. For an individual who filed the return on time, the failure-to-pay penalty is generally reduced from 0.5% to 0.25% per month or partial month while an approved installment agreement is in effect. This does not automatically reduce failure-to-deposit penalties or erase penalties already assessed. We review any separate eligibility for penalty relief.
Can the IRS still levy my assets under a payment plan?
With certain exceptions, the IRS generally cannot levy while an installment-agreement request is pending or an agreement is in effect. Protections can also apply during the applicable rejection, termination, and appeal periods. A plan does not automatically release an existing levy or remove a federal tax lien, and refunds may still be applied to your debt. Missing payments or failing to meet new filing and payment obligations can lead to default.
What if I cannot afford the proposed monthly payment?
If you cannot meet the payment required for a Simple Payment Plan, the IRS may consider another agreement after reviewing income, assets, and allowable expenses on a collection information statement. A partial-payment installment agreement may be an option if you cannot pay in full before the collection deadline, and it is generally reviewed every two years. If paying would prevent you from meeting basic living expenses, Currently Not Collectible status may temporarily pause most collection, but it does not cancel the debt or stop interest and penalties.
Does an installment agreement affect my credit?
An installment agreement is not a consumer loan. A Notice of Federal Tax Lien is a separate public record that can limit your ability to obtain credit or refinance property, even if it does not appear on a standard consumer credit report. Approval of a payment plan does not automatically release or withdraw a lien. We review whether you qualify for lien relief under the applicable IRS rules.
Why file your taxes with Mraz Tax Solutions LLC?
We focus on individual and small business returns, whether you are filing a W-2, reporting 1099 income from the sharing economy, or running your own company.
Our process is designed to minimize your tax burden and secure the maximum refund you are legally entitled to by taking time to understand your situation, your records, and your long-term goals.
Tax Resolution Help
Related Tax Resolution Services
Past-Due Taxes & Unfiled Returns
File back taxes, respond to the IRS, and negotiate payment plans or settlements.
IRS Notice Review
Professional review and response to any IRS or state tax notice, with representation.
Offer in Compromise
Settle your tax debt for less than the full amount when you cannot pay.
Get in Touch
Have any questions?
Let's talk.
Request a free initial consultation to discuss your situation, service scope, and pricing. We will contact you to arrange a call. Specific tax advice and ongoing planning are provided under the terms of an engagement.
Office visits are by appointment. We accept tax-document drop-offs after a signed engagement agreement and by prior arrangement. Please request an appointment before visiting.
Send Us a Quick Message
We usually respond within one to two business days.
Fields marked * are required. We ask for your phone number to follow up and arrange a call.