Installment agreements (IAs) are a widely used tool for tax collection and assisting a taxpayer pay off an outstanding liability in smaller more manageable amounts. They are generally used when you are unable to pay the tax but you can pay enough each month to pay off the tax in a reasonable amount of time – generally no more than five years, or 60 months. However, penalties and interest will continue to accrue, like any other serviceable debt.
Frequently, the amount a taxpayer can pay monthly will not even cover the accruing interest. If this is true in your case, you may be a candidate for an Offer in Compromise or a Partial Pay Installment Agreement. When your outstanding liability including penalties and interest is greater than $25,000 the IRS will also require detailed financial information before negotiating an Installment Agreement. http://getirshelptoday.com