Can I Pay My Business Taxes Using an Installment Plan?

Question: Can I Pay My Business Taxes Using an Installment Plan?

If you cannot pay your business taxes when they are due, here is information on how to pay your business taxes using an installment plan.

Answer:

The IRS allows you to make payments on the taxes you owe. Here is how it works:

If you owe $25,000 or less
If you owe $25,000 or less in taxes, interest, and penalties, you can use the Online Payment Agreement to set up your payment.

To use this online application you will need:

  • Your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
  • A Personal Identification Number (PIN) which you receive from the IRS. If you don't have one, you will need to call the IRS to get it.
  • Information about your income and expenses, to determine the amount of your payment plan.
  • Decide which day of the money you want your monthly payment to be due.

Payment Options
When you apply for a payment plan online you can:

  • Pay in full, to avoid interest and penalties
  • Ask for a short term extension of up to 120 days. If this option is approved, there is no fee.
  • Take a longer-term payment plan, if you are approved. Under this option, you must have filed all your tax returns that are due and pay a user fee.

If you are approved for a payment plan, payments will in most cases be taken from your bank account, or you may be able to request payroll deductions.

If you owe more than $25,000
If you owe more than $25,000 you may still be eligible for a payment plan. You will need to complete a Collection Information Statement Form (433) before your eligibility can be determined.

Receiving a bill from the IRS
If you filed your tax return and you didn't pay the taxes that were due, you will receive a bill from the IRS.

You will need the information on this bill to apply for a payment plan.

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