Streamlined Installment Agreement - Process & Guidelines

A Streamlined Installment Agreement (IA) is best for those taxpayers who owe the IRS more than $10,000 dollars but less than $25,000. The reason why it is coined "streamlined," is because the IRS will typically provide you with this type of IA without requiring a financial statement (forms 433) provided that you meet the qualifications and follow the process below.

Streamlined Installment Agreement Requirements

1. Less Than $25k in back taxes or tax debt (including assessed penalties and interest)
2. The taxes owed are not more than 5 years old and you have filed tax returns
3. You don't have any other IAs currently with the IRS
4. You are not in bankruptcy (or filed for it) or had an Offer In Compromise Accepted
5. You can and agree to make monthly payments on your current balance over 5 years or less

Streamlined Installment Agreement Process

1) File all tax returns if you haven't (requirements above clearly state this)

2) Fill out Form 9465 or utilize the Online Payment Agreement Application (OPA) at the IRS.gov or have your professional (Power of Attorney) provide you assistance by completing the process for you. Make sure to read the details the IRS provides as well. It is recommended to use the OPA because typically you will know much faster whether your IA has been accepted. If you are filling out form 9465, do not fill in section 5 as it is not required if you owe less than $25,000.

3) Determine Monthly Payment: Find out your payment per month by taking the total amount you owe, including interest and penalties, and divide that by 50, for 50 months. The reason this is calculated this way is because the remaining 10 months of the 5 year payment plan is set aside for interest.

4) Pay User Fees: a $52 User fee (for ACH withdrawal or debit) or the $105 (check or payroll deduction) with your first payment which will be due in about 45 days. This fee can be reduced if you are under Dept of Health & Human Services poverty level.

5) Date, Sign and Send Away - If you are not using the Online Payment Agreement Application, then make sure to make copies of Form 9465 you complete, and send original hard copies to the appropriate IRS address which is listed on the 2nd page of Form 9465.

Typically, you will get a response within 30 days or less and a confirmation letter with the payment terms. If the IA is rejected, the IRS will not make collection efforts on your property for at least 30 days. As noted on other pages, although the IRS will not increase collection efforts during the time you wait for an IA decision or acceptance, the IRS can, at any time during the payment plan's life, impose a tax lien on your property until your last monthly payment is paid.

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