Do’s And Don’ts When Setting Up Your IRS Payment Plan

If you’re behind on your taxes and struggling to pay up, a payment plan with the IRS may be your best option for avoiding stiff penalties. Unfortunately, setting up such a plan can prove surprisingly difficult. Below, we offer a few key do’s and don’ts to help you navigate the payment plan process:

Do: Determine Your Options

Installments are certainly a viable option for tackling your tax debt, but they’re not the only option. Depending on your situation, you may also be eligible for Currently Not Collectible (CNC) status or an Offer in Compromise (OIC). Before you apply for an installment plan, get a feel for your other options to determine which approach is in your best interest.

Don’t: Get Too Ambitious

A short-term payment plan made up of higher installments could allow you to sidestep considerable application fees — but if you’re not prepared for higher payments, this approach could also lead to default. Analyze your financial situation carefully to determine what, exactly, you can handle each month.

Do: Seek A Low-Income Payment Plan, If Possible

If you qualify for a low-income payment plan, you could avoid typically mandated application fees. Waivers are available to those with adjusted gross incomes of 250 percent or less of the federal poverty level.

Don’t: Go It Alone

While it’s possible to set up your IRS installment plan on your own, you may benefit from the assistance of a tax expert, who can help you navigate the complications of this process while also ensuring that you qualify for low-income waivers and other financial benefits.

Are you struggling to find balance as you set up an IRS payment plan? There’s no need to take on this difficult task on your own. Call Highland Tax Resolution at 720-398-6088 to learn more about your options.