What Irs Form 13844 Toggle 2024

In an earlier video, I talked about the three types of installment agreements that a taxpayer can make with the IRS. In this video, we're going to talk in more detail about the partial pay installment agreement. Sometimes, the partial pay installment agreement is an amazing deal, even better than the offer and compromise. But your facts have to fit just right, so let me explain. Typically, there is a 10-year statute of limitations for the collection of income tax in an IRS case. Here's what that means in English: if a taxpayer files a tax return with a balance due, there's ten years for the IRS to collect that tax, with certain exceptions. In otherwise, the tax liability actually expires. So, in a case where someone has a high tax liability and a low number of months left in the collection statute, the IRS will allow them to enter into a partial pay installment agreement. Let me give you an example. Let's say you come into my office and you have 18 months left on the collection statute, but you owe $100,000. Now, you're a low-income taxpayer and for whatever reason, you don't want to entertain an offer and compromise. You don't quite qualify for hardship status, meaning you have some monthly disposable income at the end of the day, but you want to go ahead and enter into a partial pay installment agreement. If you had $100 a month, for example, on this scenario of monthly disposable income and 18 months left on the collection statute, you would make those payments in equal monthly installments of $100 per month. And you would end up paying a grand total of eighteen hundred dollars on a hundred thousand dollar liability. Is that far-fetched? No, it actually is quite frequently the case. It's not...