Payment of Tax Debt & Resolution of Tax Debt

Last updated on May 24, 2022

The resolution of tax debt may or may not require the payment of the debt. Currently Not Collectible is an IRS payment plan where taxpayers receive a stay of collections and the postponement of payment because of their inability to fulfil the tax debt in their current financial situation.

If taxpayers do not have the ability to pay or can only pay a partial amount of tax debt, they may explore the IRS debt payment plans that can help them resolve their back taxes without paying the full debt amount

An Offer in Compromiseis an IRS debt payment plan where taxpayers pay a reduced amount to the IRS to resolve their back taxes. This plan in particular has strict qualifying factors not all taxpayers can clear.

A Partial Payment Installment Agreement is another IRS debt payment plan where taxpayers pay the reduced debt amount in payments resulting in paying a overall reduced amount. This plan makes it convenient to pay tax debt for those who cannot afford to pay their full tax debt, but want to resolve their back taxes and get back into compliance.

Taxpayers should consult a tax lawyer or a tax resolution service to choose the most appropriate and advantageous IRS payment plan. Considering the various options available before placing a request before the IRS ensures time and effort will not be lost.