Many people and businesses struggle with tax debt, often resulting in the need for an installment agreement with the IRS. However, in the past, the criteria for receiving an installment agreement were often complex and burdensome. Fortunately, the IRS has recently streamlined the criteria for installment agreements, making it easier for individuals and businesses to qualify.
Here are some of the key changes to the streamlined installment agreement criteria:
1. Increased Threshold for Individual Taxpayers
Previously, individual taxpayers had to owe less than $50,000 in combined tax, penalties, and interest to qualify for a streamlined installment agreement. However, the threshold has now been raised to $100,000, giving many more individuals the opportunity to apply for an installment agreement.
2. Extended Repayment Periods
Installment agreements are typically designed to be repaid within 72 months. However, the IRS has now extended the repayment period to up to 84 months for taxpayers who owe more than $50,000 and up to $100,000.
3. No Requirement for Financial Disclosure
Previously, taxpayers were required to disclose detailed financial information to the IRS in order to qualify for an installment agreement. However, the streamlined criteria now allows taxpayers not to disclose their financial information and still qualify for an installment agreement if they owe $50,000 or less.
4. Faster and Easier Application Process
The IRS has also improved the application process for installment agreements. Taxpayers can now apply for an installment agreement online or by filling out Form 9465. The online application process is faster and more efficient, allowing taxpayers to receive an immediate response on their eligibility.
These changes to the installment agreement criteria make it easier for taxpayers to qualify and repay their tax debt. However, it’s important to note that installment agreements still come with interest and fees, so it’s important to make payments on time and in full to avoid further penalties and interest.
In conclusion, if you’re struggling with tax debt, consider applying for a streamlined installment agreement. With the new criteria, you may be able to qualify and repay your tax debt over an extended period of time, making it easier to manage your finances and avoid further penalties.