IRS Installment Agreement Help From Licensed Tax Agents in Pasadena, CA
Owing the IRS more than you can pay at once does not have to mean living in fear of the next letter. At Fresh Start Tax Relief Services in Pasadena, our licensed tax agents negotiate IRS payment plans for taxpayers who cannot negotiate on their own, or who are simply scared to try. We make sure the plan we negotiate is one you can handle. As a women-owned business with decades of experience dealing with the IRS, we know which plans are available and how to set them up the right way.
Who a Payment Plan Is For
A payment plan is built for people who can pay their tax debt over time but not in one lump sum. That covers a lot of situations: a balance that surprised you at filing time, a few years of back taxes, or a debt that grew larger than expected once penalties and interest were added.
It is also for people who dread calling the IRS. Many of our clients tried once, felt pressured into a payment they could not afford, and gave up. We take that conversation off your plate entirely.
Types of IRS Payment Plans
The IRS offers several kinds of plans, and the right one depends mostly on how much you owe and how quickly you can pay it.
Short-Term Payment Plans
If you can pay your full balance within 180 days and owe less than $100,000 in combined tax, penalties, and interest, a short-term plan may be the simplest option.
Guaranteed and Streamlined Plans
Individuals who owe $10,000 or less and can pay within three years generally qualify for a guaranteed plan. For balances of $50,000 or less, a streamlined agreement can generally spread payments across up to 72 months without a detailed financial statement.
Plans for Larger Balances
Once a balance goes above $50,000, the IRS usually asks for a full financial statement covering your income, expenses, and assets. This is where experienced negotiation matters most, because the IRS uses those numbers to decide what monthly payment it will accept.
Partial Payment Plans
Some taxpayers cannot pay the full balance before the IRS collection period ends. In those cases, a partial payment installment agreement may allow monthly payments based on what you can afford, even if the total paid is less than the full debt. These plans require a financial statement and periodic review.
Payment Plans for Businesses
A business that owes $25,000 or less in combined tax, penalties, and interest may qualify for a plan of up to 24 months. Larger business balances require more documentation.
What Changes Once Your Plan Is Approved
An approved plan brings real relief. The IRS generally cannot levy your bank account or wages while a payment plan request is pending or while the agreement is in effect. The failure-to-pay penalty also generally drops to 0.25% per month during an approved plan, as long as your return was filed on time.
Some things continue, though. Interest still accrues on the unpaid balance, and any future refunds are applied to what you owe. IRS setup fees vary by plan type, are lower when you pay by direct debit, and may be reduced or waived for low-income taxpayers.
Why Let Us Negotiate for You
We review your full financial picture before recommending a plan. Sometimes a payment plan works best on its own. Other times, it makes sense to pair it with penalty abatement to reduce the balance first. And for taxpayers who meet certain financial guidelines, an Offer in Compromise may settle the debt for a fraction of what is owed. We will tell you honestly which path fits.
Serving Pasadena and Taxpayers Nationwide
We help clients in Pasadena, Glendale, La Cañada Flintridge, San Gabriel, and across Los Angeles County. Our work reaches well beyond Southern California: "Not only do we service every single county in California, but we service taxpayers nationwide." Learn more about the Tax Superwomen on the Fresh Start Tax Relief home page.
Frequently Asked Questions
How much can I owe and still get a streamlined payment plan?
Individuals who owe $50,000 or less in combined tax, penalties, and interest can generally get a streamlined plan with payments spread over up to 72 months.
Can the IRS levy my accounts while I am on a payment plan?
Generally, no. The IRS cannot levy while your payment plan request is pending or while the agreement is in effect, as long as you stay in compliance.
Do penalties and interest stop once I am on a plan?
Interest continues, but the failure-to-pay penalty generally drops from 0.5% to 0.25% per month during an approved plan if your return was filed on time.
What if I cannot pay the full balance before the collection period ends?
A partial payment installment agreement may allow lower monthly payments based on your ability to pay. It requires a full financial statement and periodic IRS review.
Will the IRS keep my tax refunds while I am on a plan?
Yes. Any federal refunds you are due while on a payment plan are generally applied to your outstanding balance.
Can my business set up an IRS payment plan?
Yes. A business owing $25,000 or less in combined tax, penalties, and interest may qualify for a plan of up to 24 months. Larger balances need more documentation.