People who owe the Internal Revenue Service (IRS) often want to find ways that they can take care of the debt they owe. There are several options for this, so it’s critical that they understand the specifics of each one to ensure they choose the best option for their needs.
One option that some people can benefit from is the streamlined installation agreement. This is a simplified payment plan that allows taxpayers to pay off their debt over time. This option doesn’t require financial documentation or negotiations. It’s best for someone who has a manageable amount of tax debt and wants to prevent collection actions.
Eligibility and terms
A streamlined installation agreement is intended for taxpayers who owe less than $50,000 in taxes, penalties and interest. Taxpayers have up to 72 months to pay off the balance. The qualification process is more lenient than other agreements.
Benefits of a streamlined installment agreement
One of the most beneficial points of the streamlined installment agreement is that it’s simple to qualify for and it stops the harsher collection methods that are commonly used by the IRS. This includes stopping the filing of a tax lien, which is an IRS collection tool that can impact the person’s credit score.
By staying compliant with the agreement’s terms, taxpayers can pay off their debt in a manageable way, avoiding further penalties and interest. It may behoove taxpayers to have someone familiar with this process so they can ensure they’re doing what’s best for them.