Given the large amount of tax you owe on your tax return and the fact that you don’t currently have the money to pay this liability, I think we should consider requesting an IRS Installment Agreement. This will allow you to pay your tax liability on a monthly basis.
Generally, if the IRS accepts your installment proposal, you will have 72 months to pay your outstanding tax liability. Because the amount of tax you owe is under $10,000, the IRS is required to accept your offer if, as of the offer date, the following requirements are met:
(1) You (and your spouse, on a joint return) have not Failed to File any income tax return, failed to pay any tax required to be shown on an income tax return, and have not entered into any other installment agreement for income taxes, during any of the five preceding tax years;
(2) The IRS finds that you are financially unable to pay the liability in full (Status 53 – Currently not Collectible) on its due date; and
(3) You agree to comply with all the provisions of the Tax Law for the duration of the agreement.
You will be subject to interest charges and may be subject to a Late Payment Penalty on any tax not paid by its due date. Interest and any applicable penalties will be charged until the balance is paid in full. To limit interest and penalty charges, you should pay as much of the tax as possible with the return.
Please let me know at your earliest convenience if you are interested in requesting an installment agreement with the IRS. If you are, then I will go ahead and prepare Form 9465, Installment Agreement Request. Then we can set up an appointment for you to come in and sign the form and go over any questions you may have.
Please contact the office of Don Fitch Accountancy at (760)567-3110 or Email Don.Fitch@CPA.com if you have any questions or would like additional information.
DON FITCH, CPA
74478 Highway 111 #3
Palm Desert, CA 92260
Toll Free: (877)CPA-Help or (877)272-4357
P.S. My firm is based upon referrals. Please feel free to refer my firm to anyone you know that is looking for a new CPA and/or tax preparer. Thank you in advance.
(Updated 06022021-1 320-610)