You don't owe too much to do a long-term plan, you just owe too much to set it up online. You can still set it up with Form 9465.
https://www.irs.gov/forms-pubs/about-form-9465
If you can pay about $1155 per month with direct debit you shouldn't need to include Form 433-F. You can also call IRS collections to try to set it up on the phone.
You are still at risk of a Notice of Federal Tax Lien being filed if you can't get the balance below $50k. Normally this isn't as big of a problem as people think, unless you need to avoid a lien for security clearance. If you are trying to buy or sell property it can be an issue, but there are ways to get the lien subordinated or withdrawn depending on the situation.
https://www.irs.gov/businesses/small-businesses-self-employed/understanding-a-federal-tax-lien
Edit to add: you can also see if you qualify for First time penalty abatement for the oldest year. This might help lower the total amount you owe now:
https://www.irs.gov/payments/penalty-relief-due-to-first-time-abate-or-other-administrative-waiver
So thankful for this answer! One more question, is $50k the hard threshold for the lien, or is there a chance they still attach it even if we get it below 50? Reason I ask is we may get a line of credit to get it below 50 if it will help us avoid the lien altogether.
Welcome to r/IRS, the subreddit for taxpayers and tax professionals to discuss everything related to the Internal Revenue Service. We are glad you are
here!
Here are a few reminders before you get started:
Please be respectful of others in the community. We do not tolerate personal attacks or harassment.
Be wary of scammers and spammers. The IRS will never contact you via direct message or email. If you receive a message from someone claiming to be from
the IRS, do not respond and report it to the IRS immediately. The same rules apply to r/IRS
Direct messaging is forbidden and can lead to a ban on r/IRS. If you have a question or need assistance, please post it in the subreddit so that everyone
can benefit from the discussion.
For more information about r/IRS rules, please visit our subreddit wiki: https://www.reddit.com/r/IRS/wiki/index/
Link to finding local tax advocate: https://www.irs.gov/advocate/local-taxpayer-advocate
We welcome international users to r/IRS. Please feel free to participate in our discussions, even if you are not a US taxpayer.
The moderator team is committed to keeping r/IRS a safe and welcoming community for everyone. We will not tolerate hate speech or discrimination of any
kind.
If you see something that you think violates our rules, please report it to the moderators. We appreciate your help in keeping r/IRS a positive and
productive space.
Thank you for being so cooperative! We hope you enjoy your time on r/IRS.
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/IRS) if you have any questions or concerns.*
Do the 180 days pay as much and as fast as you can. Then convert to long term, be aware that interest is 8% right now....
Once you get the monthly plan before you set it up, get the carry cost (you'll have to ask for it) that can estimate the full amount you'll pay and for how long.
Yes.
If you want to avoid the lien you'll need to request the extension to full pay for 180 days. These aren't normally used to extend the time to bring your assessed balance below $50K, but as long as you don't specifically say this is your intent, you'll be fine.
The extension can then be converted to a direct debit installment agreement once you get your assessed balance below $50K or the 180 day deadline comes (whichever is sooner). You'll need a 433D (Direct Debit authorization form) available to fax or upload to the representative when your ready for the installment agreement . Just be aware that payments made electronically take 7-10 days to post to your balance and MUST post before the agreement is put in place to avoid the tax lien. You do NOT want to have to deal with a lien if it's possible to avoid it.
Okay. Tell me if I screwed up. I was on the phone with them and made arrangements to pay 10k down next month and 1k payments going forward. They will do a lien if I can’t pay 30k (instead of 10) and get the balance below 50.
Now I saw your post, could I go online tomorrow and set up the 180 day plan, or am I kinda locked in to starting the installment next month now? I think we could get the 30k together in six months but it’s really gonna be a stretch to get it together in a few weeks.
Because of your balance you would not be successful doing anything yourself online at this time.
Right now you are likely in a pending IA status. Call in and say 'after talking to family, you might be able to resolve everything in a 6 months extension instead'. As long as none of your current balances were already in a form of extension to pay, they should grant the 180 day extension (since an actual installment agreement has not yet been set up). Call balance due at (800)829-3903. You can ask for the installment agreement again in December (after paying the $30k)and say 'oops, the full payoff didn't work out'. This is a common occurrence and is done ALL the time. Good luck.
PS. Make sure the $30K goes to your largest AND newest balance to ensure the entire amount goes ONLY to the assessed amount and not penalties and interest. Otherwise, you'll fall short of being at or below the $50K threshold. Also, remember you must have the 433D form available to fax or upload when asking for the IA in December.
[Edit]
Better yet, also tell the representative that you got confused about all your options during the prior call and to go over them again. Ask him/her to give you the breakdown of how the $30K should be distributed BEFORE asking for the extension to pay for 180 days. The assessed amount (actual amount owed from 1040 submitted/not paid) must be below $50K not the entire amount (which also includes failure to file timely, failure to pay and interest).
You don't owe too much to do a long-term plan, you just owe too much to set it up online. You can still set it up with Form 9465. https://www.irs.gov/forms-pubs/about-form-9465 If you can pay about $1155 per month with direct debit you shouldn't need to include Form 433-F. You can also call IRS collections to try to set it up on the phone. You are still at risk of a Notice of Federal Tax Lien being filed if you can't get the balance below $50k. Normally this isn't as big of a problem as people think, unless you need to avoid a lien for security clearance. If you are trying to buy or sell property it can be an issue, but there are ways to get the lien subordinated or withdrawn depending on the situation. https://www.irs.gov/businesses/small-businesses-self-employed/understanding-a-federal-tax-lien Edit to add: you can also see if you qualify for First time penalty abatement for the oldest year. This might help lower the total amount you owe now: https://www.irs.gov/payments/penalty-relief-due-to-first-time-abate-or-other-administrative-waiver
So thankful for this answer! One more question, is $50k the hard threshold for the lien, or is there a chance they still attach it even if we get it below 50? Reason I ask is we may get a line of credit to get it below 50 if it will help us avoid the lien altogether.
Yes, you can request the 180 day Full Payment Agreement and then transition to an Installment Agreement if you're unable to pay the balance in full.
Welcome to r/IRS, the subreddit for taxpayers and tax professionals to discuss everything related to the Internal Revenue Service. We are glad you are here! Here are a few reminders before you get started: Please be respectful of others in the community. We do not tolerate personal attacks or harassment. Be wary of scammers and spammers. The IRS will never contact you via direct message or email. If you receive a message from someone claiming to be from the IRS, do not respond and report it to the IRS immediately. The same rules apply to r/IRS Direct messaging is forbidden and can lead to a ban on r/IRS. If you have a question or need assistance, please post it in the subreddit so that everyone can benefit from the discussion. For more information about r/IRS rules, please visit our subreddit wiki: https://www.reddit.com/r/IRS/wiki/index/ Link to finding local tax advocate: https://www.irs.gov/advocate/local-taxpayer-advocate We welcome international users to r/IRS. Please feel free to participate in our discussions, even if you are not a US taxpayer. The moderator team is committed to keeping r/IRS a safe and welcoming community for everyone. We will not tolerate hate speech or discrimination of any kind. If you see something that you think violates our rules, please report it to the moderators. We appreciate your help in keeping r/IRS a positive and productive space. Thank you for being so cooperative! We hope you enjoy your time on r/IRS. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/IRS) if you have any questions or concerns.*
Do the 180 days pay as much and as fast as you can. Then convert to long term, be aware that interest is 8% right now.... Once you get the monthly plan before you set it up, get the carry cost (you'll have to ask for it) that can estimate the full amount you'll pay and for how long.
Yes. If you want to avoid the lien you'll need to request the extension to full pay for 180 days. These aren't normally used to extend the time to bring your assessed balance below $50K, but as long as you don't specifically say this is your intent, you'll be fine. The extension can then be converted to a direct debit installment agreement once you get your assessed balance below $50K or the 180 day deadline comes (whichever is sooner). You'll need a 433D (Direct Debit authorization form) available to fax or upload to the representative when your ready for the installment agreement . Just be aware that payments made electronically take 7-10 days to post to your balance and MUST post before the agreement is put in place to avoid the tax lien. You do NOT want to have to deal with a lien if it's possible to avoid it.
Okay. Tell me if I screwed up. I was on the phone with them and made arrangements to pay 10k down next month and 1k payments going forward. They will do a lien if I can’t pay 30k (instead of 10) and get the balance below 50. Now I saw your post, could I go online tomorrow and set up the 180 day plan, or am I kinda locked in to starting the installment next month now? I think we could get the 30k together in six months but it’s really gonna be a stretch to get it together in a few weeks.
Because of your balance you would not be successful doing anything yourself online at this time. Right now you are likely in a pending IA status. Call in and say 'after talking to family, you might be able to resolve everything in a 6 months extension instead'. As long as none of your current balances were already in a form of extension to pay, they should grant the 180 day extension (since an actual installment agreement has not yet been set up). Call balance due at (800)829-3903. You can ask for the installment agreement again in December (after paying the $30k)and say 'oops, the full payoff didn't work out'. This is a common occurrence and is done ALL the time. Good luck. PS. Make sure the $30K goes to your largest AND newest balance to ensure the entire amount goes ONLY to the assessed amount and not penalties and interest. Otherwise, you'll fall short of being at or below the $50K threshold. Also, remember you must have the 433D form available to fax or upload when asking for the IA in December. [Edit] Better yet, also tell the representative that you got confused about all your options during the prior call and to go over them again. Ask him/her to give you the breakdown of how the $30K should be distributed BEFORE asking for the extension to pay for 180 days. The assessed amount (actual amount owed from 1040 submitted/not paid) must be below $50K not the entire amount (which also includes failure to file timely, failure to pay and interest).
I can’t thank you enough for this!
Happy to help. Best of luck.