IRS Programs

IRS installment agreements

An installment agreement is a payment plan between a taxpayer and the IRS that allows tax debt to be paid off in monthly installments over time. It is one of the most commonly used IRS resolution options, and several types are available depending on the amount owed and the taxpayer's financial situation.

Types of installment agreements

• Guaranteed: Available to taxpayers who owe $10,000 or less (excluding penalties and interest), have filed all required returns, and have not had an installment agreement in the past five years. The IRS must approve this plan if the taxpayer meets these criteria.
• Streamlined: Available to individuals who owe $50,000 or less and businesses that owe $25,000 or less. No detailed financial statement is required. Taxpayers apply using IRS Form 9465 or the IRS Online Payment Agreement tool.
• Non-streamlined: For amounts exceeding the streamlined thresholds. Requires a full financial disclosure on Form 433-A (individuals) or Form 433-B (businesses). The IRS determines the monthly payment amount based on the taxpayer's ability to pay.
• Partial payment: For taxpayers who cannot pay the full balance within the collection statute (typically 10 years). The IRS accepts payments that will not cover the total debt. Requires a financial review and is subject to periodic reassessment.

How to apply

Taxpayers can apply online through the IRS Online Payment Agreement tool for balances of $50,000 or less, or by mailing Form 9465. There is a setup fee: $31 for online direct debit agreements, $130 for other online agreements, or $225 for applications submitted by mail or phone. Low-income taxpayers may qualify for reduced or waived fees.

What to know before applying

• All required tax returns must be filed before the IRS will approve a plan.
• Penalties and interest continue to accrue on the unpaid balance during the agreement.
• Missing a payment or failing to file future returns on time can default the agreement.
• An IRS tax lien may still be filed, even with an approved payment plan.
• Direct debit (automatic withdrawal) is required for balances between $25,001 and $50,000 under the streamlined program.

This information is for educational purposes only and does not constitute tax, legal, or financial advice. Eligibility for IRS programs is determined by the IRS based on individual circumstances. For official guidance, visit IRS.gov.