Guide to Settling & Resolving Iowa Back Tax Problems

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iowa back taxes problems

The Iowa Department of Revenue is the state agency responsible for regulating taxation of both individuals and businesses. The agency functions like the IRS by assessing taxes, processing returns and issuing refunds. The Department of Revenue is also responsible for collecting unpaid or unfiled taxes. If you live in Iowa and you owe back taxes, the Department of Revenue offers several payment options to help get you back on track. 

Installment Payment Agreement

If you don’t have the money to pay your entire tax bill at once, you can contact the DOR about setting up a payment plan. Payment plans can last for up to 24 months and the minimum payment is $10 per month. To set up a payment plan, visit the Iowa PayDebt website and register for an account. You’ll need your mailing address, payment information and the account number found on your billing notice to set up a payment plan.

You can make your payments by credit or debit card, automatic bank draft or paper check. Checks can be mailed to:

Iowa Department of Revenue
PO Box 10471
Des Moines IA  50306-0471

If you sign up for a payment plan, keep in mind that any future tax refunds you receive will be applied to your balance in accordance with the State of Iowa Offset Program.

Iowa Offer in Compromise

When you owe a large amount of tax debt, paying it off can be difficult when the penalties and interest continue to add up. Depending on your circumstances, the Department of Revenue may be willing to accept an Offer in Compromise (OIC).

An Offer in Compromise is essentially a settlement of your tax debt. You agree to pay a certain amount towards your outstanding tax debt and the Iowa DOR forgives the remaining balance. The process works in a way that’s similar to an IRS Offer in Compromise. The state of Iowa has specific guidelines that are used to determine who qualifies for an OIC and you can get more information by calling 1-866-339-7912.

Penalty Waiver

If you’ve been assessed a penalty for unpaid taxes you can also ask the Department of Revenue for a waiver. Penalty waivers are only granted when certain conditions are met. The complete list of penalty exceptions can be found here.

You can request a penalty waiver by writing a letter to the Department of Revenue explaining why your return and/or payment was late. You must specifically ask for a “waiver of penalty.” You’ll need to send the letter and the billing notice to:

Iowa Department of Revenue
Hoover State Office Bldg
PO Box 10471
Des Moines IA 50306-0471

If You Need Help

One of the goals of the Iowa Department of Revenue is to help taxpayers resolve their back tax issues as quickly as possible. If you have questions about your tax bill or you want to learn more about your payment options, you can contact the DOR at the following phone numbers.

  • Billings & Collections – (515) 281-6944 or 1-866-339-7912
  • General Questions – (515) 281-3114 or 1-800-367-338

You can also send general questions or inquires via mail to the address listed below:

Taxpayer Services
Iowa Department of Revenue
PO Box 10457
Des Moines IA 50306-0457

Getting Professional Help to Resolve Your Tax Problems is one of the premier tax resolution sites serving Iowa, offering tax solutions for every individual’s unique financial situation. We created a strong and diverse team of tax professionals who will settle, file, reduce and resolve State and IRS taxes. All of our tax professionals will provide you with a free consultation to give you your options and likely outcomes. Sign up and receive your free consultation today!

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