IRS Installment Agreements & Payment Plans

For most people who owe the IRS, a payment plan is the most realistic way out. It is not a discount, but it is predictable, it protects your paycheck and bank account, and it is often the right first step even when we are looking at other options like an Offer in Compromise or penalty abatement.

• Short-term payment plan: you pay the balance in full within 180 days. The IRS lists a $0 setup fee, but penalties and interest keep accruing until it's paid.
• Long-term payment plan (installment agreement): you pay monthly for longer than 180 days. Setup fees depend on how you apply and pay. Per irs.gov, it's $29 online or $107 by phone, mail, or in person with direct debit. Without direct debit, it's $69 online or $178 by phone, mail, or in person. Low-income taxpayers can have fees waived or reduced and possibly reimbursed.

Fees as of October 2026 per irs.gov

Paying by direct debit costs less to set up, and it can matter in other ways too. For example, the IRS may withdraw a filed Notice of Federal Tax Lien for some taxpayers who owe $25,000 or less and are on a direct debit agreement that meets its conditions.

• Long-term plan: you owe $50,000 or less in combined tax, penalties, and interest, and you have filed all required returns.
• Short-term plan: you owe less than $100,000 in combined tax, penalties, and interest.

You can still get a payment plan if you owe more than these thresholds or have business payroll taxes. It just usually means more paperwork. The IRS may ask for a collection information statement (Form 433-A, 433-B, or 433-F), and the monthly payment is negotiated against your actual income and allowable expenses.

In almost every case, filing compliance comes first. If you have unfiled returns, those need to be filed before the IRS will agree to a plan. That is something we handle as part of the case.

• The amount isn't what you think. We pull your IRS transcripts to confirm exactly which years and balances are open, and whether penalties could be removed before the plan is set.
• The monthly payment is too high. For larger balances, the payment is based on the IRS financial analysis. Getting the financial statement right is the difference between a payment you can keep and one that defaults in six months.
• There's a better option. Some people who set up a plan actually qualify for currently-not-collectible status or an Offer in Compromise. We review that before you commit.
• Collection is already underway. If there's a levy, garnishment, or final notice, timing matters. A properly requested plan can stop or release collection action.

1. Free review of your situation and any IRS notices.
2. Power of attorney (Form 2848) so the IRS contacts us, not you.
3. Transcript analysis to confirm what you owe, by year, and spot penalty relief.
4. Compliance: we prepare any missing returns.
5. Negotiation: we request the plan type and monthly payment that fits your real budget.
6. Follow-through: we help you stay current so the agreement doesn't default.