How To Set Up An IRS Payment Plan To Eliminate Your Debt
Once you’ve had the chance to look at your IRS debt and fret for a moment, it’s time to get down to business. Too often we see clients who find themselves in this situation and freeze out of embarrassment, fear, and a lack of understanding how this can be resolved.
You don’t have to go this alone, so make sure you have a dependable and experienced IRS resolutions team behind you. And after all of your documentation has been reviewed to ensure that this debt is legitimate and the IRS hasn’t made a mistake (which happens more often than you may realize) it’s time to set up an IRS payment plan.
There are four main plans that the IRS offers to people. The first is simply paying off the debt immediately, which for many people is not an option. But if it is an option for you it’s a great idea to take care of your debt once and for all. If you simply don’t have the cash handy to pay your debt you can opt for one of the next three plans.
First, is the short term payment plan during which you can set up automatic payments to the IRS from your checking account or pay by check or credit card. This short-term IRS payment plan should be paid in 120 days or fewer and is totally free to set up. Depending on how much you owe, this is another great way to get your debt paid off quickly.
Next is the first of the long-term IRS payment plans. This plan takes more than 120 days to fulfill and using this plan you must allow the IRS to automatically withdraw your payments from your checking account. The set up fee for this option is $31 if you apply online, but $107 if you apply by phone, mail, or in person. If you qualify as low income your set up fee is $31 no matter how you apply.
Last is the long-term IRS payment plan which doesn’t require you to set up an automatic withdrawal payment. However, the set up fees are higher at $149 to set up online and $225 to set up over the phone, by mail or in person. Again the IRS is willing to make concessions for people who qualify as low income.
There are a couple of other things that you should know. First, you can change your IRS payment plan at anytime, though fees may apply depending on your situation. And second, even once you’ve set up a payment plan you will still continue to accrue fees and interest until the debt is totally paid off. So, the sooner you are able to pay it off the better.
As we always say, if you have found yourself in debt to the IRS it is always better to pay it off sooner than later. So if you haven’t already contacted a IRS resolutions expert, give us a call today. We would love to provide you with the complimentary consultation and give you some information on how we can work together to get you debt free!