If you are unable to pay the full amount of tax owed, you may request a monthly installment plan.
Before applying for any payment agreement, a taxpayer must file all required tax returns.
Installment agreements generally provide up to 72 months to pay the tax. In certain circumstances, the payment period could be longer or the amount agreed to could be less than the amount of tax owed.
An installment plan is not valid unless accepted by the IRS. However, if a taxpayer owes $10,000 or less and meets certain other criteria*, the IRS must accept the request.
To request an installment agreement a taxpayer can attach Form 9465 - Installment Agreement Request to the front of his tax return, or in cases where the return is already filed-mail it directly to the IRS.
If the balance due is not more than $50,000, the taxpayer can apply online for a payment agreement instead of filing Form 9465.
If the IRS approves a request, they send a notice detailing the terms of the agreement and request a fee.
If a taxpayer is able to pay the full amount owed within 120 days, he should not request an installment agreement on Form 9465.
If the total amount the taxpayer owes is greater than $25,000 but not more than $50,000, the taxpayer may use a slightly expanded Form 9465-FS - Installment Agreement Request.
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