If you can’t pay the total taxes you owe by April 15th, you have options. Here’s what to do:
First, pay as much as you possibly can by the due date to save on interest and penalties.
Then, you can pay the remaining balance over time.
The IRS gives 3 payment options to pay off your tax balance:
90 days
180 days
Monthly payment agreement (long term)
(Note: You may be able to settle for less than the full amount you owe through the IRS’s Offer in Compromise program. To see if you qualify, click here. To learn more about the program, click here.)
How to Apply
You will need to apply for an installment agreement. You can do that by attaching a Form 9465 “Installment Agreement Request” to the front of your tax return (if mailing in your filing).
However, you can save time and money by filing your request online here: IRS Payment Plan Tool (to be eligible to apply online, you must owe less than $100,000 for a 90 or 180-day payment plan, and $50,000 or less for a long-term payment agreement).
If you choose the long-term monthly payment agreement, you will need to input the amount you can pay each month and the date you want to pay it.
(Remember, the IRS charges interest and penalties on payment plans, so the longer the plan, the more interest you will pay.)
To save the most money, do the following:
Pay as much as you possibly can by the due date (April 15th each year)
For any remaining balance, choose to pay it off in 90 or 180 days
If you cannot pay it off within 180 days, choose the monthly payment agreement and choose the maximum amount you can pay each month (to pay off your loan in the fastest time)
Ready to set up your payment agreement? Click here.