How to Set Up an IRS Payment Plan Step by Step

Have your Social Security number or taxpayer ID, your most recent tax return, the balance shown on your latest IRS notice, and a photo ID if you need to create an IRS Online Account. If you want automatic withdrawals, have your bank routing and account numbers ready. Decide in advance what monthly amount you can sustain, because missing payments is what usually causes a plan to fail. Confirm that every required return is filed; see our payment plan requirements guide if you are unsure.

Individuals who owe $50,000 or less (long-term plan) or less than $100,000 (short-term plan) can apply through the IRS online payment agreement tool. You sign in to your IRS Online Account, choose full payment, a short-term plan, or a long-term plan, enter the amount and date you want to pay, and submit. You receive immediate notice of whether the plan is approved. The tool is generally available from 5 a.m. to midnight Eastern time.

Individuals can call 800-829-1040. Businesses call 800-829-4933, which is staffed from 7 a.m. to 7 p.m. local time, or the number printed on their notice. Phone applications are available for any balance, but the setup fee is higher than online, and the representative may ask for financial information if the balance is large.

Form 9465, Installment Agreement Request, is the paper application. If the instructions require it, attach a completed Collection Information Statement such as Form 433-F. Mail it to the address listed in the form instructions for your state, and keep a copy. Processing by mail is slower than online, so continue to make payments you can afford while you wait.

You can request a plan in person at an IRS Taxpayer Assistance Center, generally by appointment. The fees for in-person requests match phone and mail, so it is mostly useful when you want to hand over documents face to face.

After approval you can pay by direct debit from your checking account, through Direct Pay from a checking or savings account, through EFTPS (enrollment required), or by check, money order, or card. Direct debit has the lowest setup fee and the lowest default risk. Card payments carry processing fees charged by the card processor, not the IRS.

While your request is pending, the IRS is generally prohibited from levying, and the collection statute is paused. If the request is rejected, the IRS generally cannot levy for 30 days, and you can appeal. Once approved, you will receive a letter confirming the amount and due date. Keep it, and keep proof of every payment.

A tax professional can request the plan for you with a signed Form 2848, Power of Attorney. The authorization must cover every tax period with a balance. Representatives can apply through a Tax Pro Account or by phone. This is useful when notices are piling up or when you want someone to negotiate the amount.

The biggest mistakes are agreeing to a payment you cannot sustain, forgetting that new taxes must still be paid on time, ignoring a refund offset, and not tracking the due date. Remember that your future refunds can be applied to the balance until it is paid off. For fees, see IRS payment plan fees and interest.

Calculus Tax, Inc. handles payment plan requests for individuals and businesses from our Burbank office at 1050 W. Alameda Ave., Burbank, CA 91506, and remotely nationwide. Contact us to get started.