For
various reasons, you may not be able to pay your tax
in full. You should not delay filing your tax return if you are
unable to pay the tax.
If you can't pay the
IRS the tax amount you owe in full, file your tax return
on time and attach to the front either a completed Form
9465, Installment Agreement Request, or your own
written request for a payment plan, specifying the tax amount and the
date you can pay the IRS each month. If you have already mailed your
tax
return and have received a tax notice or tax bill from the IRS requesting payment,
contact the IRS immediately by calling the telephone number shown on
the IRS tax notice. You may be eligible to establish a tax installment
agreement by telephone. If you prefer you may attach a completed
Form 9465 or your own request to the IRS tax notice and mail it to the
appropriate IRS office. The IRS will let you know usually within 30
days, whether your request is approved or denied, or if additional
information is needed. If approved, a one-time user fee of $43 will
be charged by the IRS.
Before requesting an
installment agreement, you should consider
other less costly alternatives, such as a bank loan. The interest
rate your bank charges may be lower than the combination of
interest and tax penalties charged by the IRS. Remember, tax penalties and
interest will be charged on the balance due even if you have an
approved installment agreement.
It is important that you contact the IRS as soon as you become
aware of a tax liability that you cannot pay. The IRS makes a
distinction between taxpayers making a sincere effort to pay their tax
debt and taxpayers who show little or no evidence of cooperation. If
you neglect or refuse to make tax payments to the IRS or other arrangements to
satisfy your tax bill in full, the IRS may take enforced tax collection
action. For additional information concerning tax questions,
alternative methods of tax payment, or the nearest location to receive tax
assistance, call the IRS at 1-800-829-1040.
If you are unable to pay the
tax due and doing so would result in
a severe hardship you can apply for a special tax payment extension on
Form
1127.
