What do i do if i cant afford the payment arrangements the irs offered me on my back taxes?

Question

What do i do if i cant afford the payment arrangements the irs offered me on my back taxes?

Answer 1

I think you have two options:  1) contact a CPA, enrolled agent, or lawyer to help re-negotiate a payment plan or 2) contact the IRS and try to re-negotiate yourself.

Answer 2

If you truly can't afford to pay your installment agreement then you must fill out form 433a and bring in proof of income for the last 90 days.  The government will make a computation and if that payment is lower than what your current payment is you can change it.  This computation will take into account your basic living expenses, then everything else goes to paying your back taxes.

They won't take into account things like big car payments, tuition for collage or private schools, unsecured debts, etc.  So your definition of what you can afford and what you the government thinks you can afford are 2 different things.

They will allow for things like living expenses (rent or mortgage pmts, utilities, car expenses, taxes, etc)

You might be able to do this over the phone, but it may be best to go to your local office and talk to someone in person.

Answer 3

Rick B is correct.  The longer you drag it out the more you are paying.  Do what ever it takes to make those payments.Otherwise you will be overpaying for the rest of your life.

Answer 4

Get a better job, work more hours, take on a part time job, cut your expenses, get rid of cable, internet, and cell phone, etc.

You can afford it, you just have to make it a priority.