Additional information about payment plans in IRS


Not every business needs to be paying off their debt immediately. When you are making your initial investment in a business, you should be sure you have a good plan in place for how you want to pay back your money. If this is the case and you want to consider using a payment plan as an option, then you should take some time to consider what options are available to you.

What are the benefits of paying my taxes on time?

Under the law, the IRS can impose penalties on taxpayers for failure to file a tax return and for failure to pay taxes due by the due date.

If you can’t pay the tax you owe by its original due date, the balance is subject to interest and a monthly late payment penalty. There’s also a penalty for failing to file a tax return, so file on time, even if you can’t pay your balance in full. It is always in your best interest to pay in full as soon as possible to reduce additional charges.


  • Avoid the accumulation of interest and additional penalties
  • Avoid offsetting your future refunds
  • Avoid trouble getting loans

Why do I have to pay an initial setup fee?

The Office of Management and Budget has directed federal agencies to collect administrative fees for services such as the Installment Payment Plans program. The IRS uses administrative fees to cover the cost of processing installment payment plans.

Am I eligible for a waiver or refund of the administrative fee?

The removal or refund of the administrative fee applies only to individual taxpayers whose adjusted gross income is, as determined in the most recent year for which such information is available, at or below 250% of the applicable federal poverty level (state taxpayers). low income), who entered the long-term payment plans (installment plan) on or after April 10, 2018. If you are a low-income taxpayer, the administrative fee is eliminated if you agree to make payments by electronic debit, establishing a direct debit installment agreement (DDIA). If you are a low-income taxpayer, but are unable to make payments by electronic debit, to establish a DDIA, the administrative fee will be refunded upon completion of the installment plan. If the IRS system identifies you as a low-income taxpayer, then the Online Request for a Payment Plan tool will automatically reflect the applicable filing fee.

How can I check my balance and payment history?

Individuals (natural persons) can view the current amount owed and payment history by viewing their Account Information. Viewing your tax account requires identity authorization with security checks. Please allow one to three weeks (three weeks for non-electronic payments) for a recent payment to post to your account.

Am I eligible to apply for a payment plan online?

Your particular expense circumstance will figure out which installment choices are accessible to you. Payment options include full payment, a short-term payment plan (pay in 180 days or less), or a long-term payment plan (installment plan) (via monthly payments).

If you are an individual, you may qualify to apply online if:

The long-term payment plan (installment plan): You owe $50,000 or less in a combination of taxes, penalties, and interest, and you have filed all required returns.

The short-term payment plan (installment plan): You owe less than $100,000 in a combination of taxes, penalties, and interest.

If you are a business, you may qualify to apply online if:

The long-term payment plan (installment plan): You have filed all required returns and owe $25,000 or less in a combination of taxes, penalties, and interest.

If you’re a self-employed entrepreneur or independent contractor, apply for a payment plan as an individual.

What can I change in my online payment plan?

You can use the Online Payment Plan tool to make the following changes:

  • Change your monthly payment amount
  • Change the due date of your monthly payment
  • Convert an existing agreement to a direct debit agreement
  • Change the routing (transit) number and bank account number on a direct debit agreement
  • Restore agreement after breach

How can I manage my plan to avoid default?

  • To avoid defaulting on your payment plan, make sure you understand and manage your account.
  • Pay at least your minimum monthly payment on your due date.
  • Timely file all required tax returns and pay all taxes in full and on time (if you can’t, contact the IRS to change your existing agreement).
  • Your future refunds will be credited toward your tax liability until it is paid in full.
  • Make all scheduled payments, even if we credit your refund to your account balance.
  • When paying by check, include your name, address, Social Security number (SSN), daytime phone number, tax year, and filing type on your payment.
  • Contact us if you move or complete and mail Form 8822, Change of Address.

Please confirm your payment information, date and amount by reviewing your recent statement or the confirmation letter you received. When you send payments by mail, send them to the address indicated on your correspondence.

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