What Is a Streamlined Installment Agreement? (SIA)
Individual taxpayers whose assessed tax debt (not counting accrued penalties or interest) is less than $25,000 can pursue a special type of payment plan called a Streamlined Installment Agreement. Under this agreement, the taxpayer agrees to pay the debt in full over the course of 5 years by making monthly payments. Unlike other IRS monthly payment agreements, the IRS doesn’t require you to provide financial documentation that shows your monthly income and expenses.
Get an IRS Payment Plan Without the Paperwork
In the application process for other IRS payment plans, IRS collection agents may ask you to provide financial documents like bank statements, mortgage statements, and pay stubs. They look at your income and expenses and determine your ability to make payments to them, but they don’t take into account a lot of expenses that real-world people have, such as charitable tithings and unsecured credit card debt. We have seen the IRS ask people to pay thousands of dollars each month after following this process.
When setting up a Streamlined Installment Agreement, however, the IRS does not require you to provide proof of your income and expenses. This is a great program for someone who has a small ability to pay back their tax debt but can’t afford what the IRS would normally ask for each month.
Streamlined Installment Agreement – Monthly Payment Amount
The amount you pay per month in a streamlined IRS payment plan is proportional to the amount you owe. It also depends on a few other things, like the amount of time the IRS has to collect on your debt (see our page on the IRS Statute of Limitations for collection), and whether you have a history of defaulting.
Every tax case is different, and as tax professionals we cannot guarantee the outcome of any proceeding involving a tax agency, but our clients typically do not pay more than $500 per month to the IRS in a SIA case.
Can I Negotiate My Own Streamlined Installment Agreement?
While we have seen people have success entering into streamlined installment agreements that they set up themselves, we have also seen lots of folks make their tax situations worse by calling the IRS. Even in a streamlined payment plan negotiation, IRS agents can still ask unsuspecting taxpayers to agree to high monthly payments. Don’t get taken for a ride! If you do not know the lowest monthly payment the IRS will accept from you, it may be a bad idea to get involved with them on your own. Call us at 855-895-1892 for a FREE consultation to learn more.
