Darren Guillot, Deputy Commissioner, Collections and Operations Support announced on January 20th that the trial policy of allowing installment plans without requiring financial information for tax debts up to $250,000 is now permanent.
Why is this a Big Deal?
The requirement to provide financial information is no easy task. Most people need professional help with preparing Form 433. Answering a question wrong, such as do you or have had any cryptocurrency transactions, could get you a visit from the Criminal Investigations Division. The ability to simply go to the IRS website and start a payment plan without financial analysis is a big time and money saver for tax debtors.
What’s the Catch?
There are a few caveats:
- This debit limit only applies to individuals and out-of-business sole proprietors.
- This option goes away if your case has been assigned to a Revenue Officer. The old limits of $50,000 and $25,000 still apply if you are dealing with an RO.
- Your payment amounts must be adequate to fully pay the debt before the Statute of Limitations runs.
Should you consider this without professional help?
Certainly, seems like a good idea to go give it a try. If the IRS calculator comes back with a monthly payment that you can’t live with, then go talk to someone. There are other options such as a Partial-Pay or an Offer-in-Compromise that will probably make more sense in these cases. Setting yourself up for a future default will make your problems worse