Installment Agreement FAQs

Installment Agreement FAQs

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Installment Agreement FAQs

1. What Are the Payment Methods the IRS will Accept for the Monthly Payments?

Direct Debit from your bank account
Payroll Garnishment from your work paycheck
Money Orders or Personal Checks
Electronic Federal Tax Payment System (EFTPS)
Credit Cars

It is recommend not using a Bank Account to pay.If you fail to make payments, the IRS has your bank account information.

2. Why Would the IRS Terminate My Existing IA?

- You failed to file subsequent returns
- Your Collection Information Statement was inaccurate (Form 433A or Form 433F)
- Your total tax liability since you begun your IA has increased
- You missed a payment

3. Can the IRS put a tax lien on my property if I am in an Installment Agreement?

- Yes, the IRS may put a tax lien on your property during an Installment Agreement just to secure themselves against other creditors with interest in your property. The deciding factor is the total outstanding balance. The IRS just raised the limit to 25K.

4. Why Would the IRS Reject a New IA Request?

- Collection Information was inaccurate or incomplete
- You previously defaulted on an IA
- You have outstanding tax returns
- Your necessary living expenses on Form 433 are unreasonable

5. What Installment Agreement is Best if Owe over $25k?

If you owe over $25k to the IRS, you will need a verified installment agreement, which means you have to prepare a Form 433, a Collection Information Statement.

6. Can the IRS levy my property if I am in an Installment Agreement?

If you are in compliance (all returns filed) and all period are under an installment agreement, the IRS should not levy or seize property.

7. What if I miss an IRS Installment Agreement Payment?

A defaulted Installment Agreement could lead to you receiving CP Letter 523, Notice of Federal Tax Levy. Missed payments, breaks the agreement with the IRS. This will make it difficult to reestablish another installment agreement and the IRS is more likely to file a lien.

8. Can I use the IRS’s Online Payment Agreement to setup an Installment Agreement even if I filed and have yet to receive an IRS Bill?

Yes. Based on IRS instructions you can setup a “pre-assessed Installment Agreement” With Form 9465. It is best to wait for your bill and then set up the Installment Agreement.

9. What is the Deadline to Appeal an Installment Agreement?

You have 30 days from the postmarked date of your rejection letter to file an appeal on rejected IA proposal. Regarding a termination notice (of a preexisting IA), you have 30 days to request an appeal, then on day 46 the IA is terminated leaving you until day 76 to request an appeal at all.

10. Will the IRS Levy my Property if my IA was Rejected?

The IRS can levy your property if you fail to file an appeal within 30 days of your rejection. If filed timely, the IRS must then wait until your appeal is either accepted or rejected, to levy your bank, wages, or any other personal property.

11. Once Appeals Make a Decision Can I Appeal that Decision?

Once the Appeals process is over after a CAP hearing, the decision is binding and you cannot request a judicial review of the Appeals’ decision

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