No matter your occupation or experience in the workforce, tax matters are nearly always difficult to deal with. Because of the assortment of tasks that must be done year-round (especially during tax time), what is supposed to be a fairly straightforward experience can become very complicated. Regardless if you’re a 20-something looking to hit the ground running or a well-established older professional nearing retirement, the difficulties inherent in tax work are all the same.
Beyond complying with guidelines and knowing about tax developments, the biggest difficulty that people face is actually paying them. In the case of those that are struggling to stay afloat in the time of COVID-19, paying the right amount on time can be especially difficult.
Thankfully, the IRS Fresh Start Program is an excellent solution that struggling people can use to their advantage during tax season. And this begs the question: Can you have two installment agreements with the IRS using this set-up?
All About the IRS Fresh Start Program
The IRS Fresh Start program was created in 2011 with one goal in mind: to develop a bridge to debt forgiveness for delinquent taxpayers. Today, it is instrumental in the modern American tax system because it helps millions of Americans settle federal tax debt. With its ever-expansive program, ease of enrollment, and regulations that minimize penalties, there’s no better solution you can use for your tax cooperation-related needs.
One factor that makes the Fresh Start program a crucial tool for struggling taxpayers is that it offers the IRS installment agreement (IA) that creates amenable conditions for paying parties. Although it doesn’t necessarily forgive a debt, it still allows a taxpayer to pay it back over time without incurring fees and penalties, leading to greater ease in the long run. The IA is also the easiest option to qualify for within the IRS debt forgiveness program thanks to its lower barriers to entry—holders to set up payment plans for up to 72 months!
Applying for Installment Agree
If you’re already enrolled in a payment plan with the IRS for a previous tax bill, you’re probably wondering what your next step should be if you can’t pay this year’s tax bill. This situation, in turn, may cause you to wonder if you can set up two or more installment agreements for more manageable repayment.
Well, there’s only one answer to this: no, you can’t have two (or even more) installment agreements with the IRS at the same time.
Additional Options for Tax Debt Payments
If you already have a payment plan, you must understand the IRS’s policy on handling new debt on top of that. When enrolled in an Installment Agreement with the IRS, you’re held to obligations and lengthy terms, one of which is that you are required to stay current with all future tax payments.
This means the IRS expects you to pay your past debt and your new debt immediately if you fail to pay or file future taxes. If you accrue additional tax debt, you must immediately contact authorities to reapply for a modified agreement that folds your new tax debt into the balance of your existing payment plan.
Reworking your installment agreement to merge new debt into a payment plan balance can be difficult to wrap your head around if this is your first time doing it. Fortunately, this is where a service provider like Axiom Tax Resolution Group can take care of everything for you moving forward!
In times like these, where money is tight, and COVID-19 has made it difficult to bounce back, you may find yourself on the shorter end of the stick of the taxpaying population. Fortunately, the IRS offers payment solutions to help. With this guide, you can take care of your situation effectively.
The IRS offers different installment agreements, and some have specific requirements you must meet to successfully set them up. An installment agreement is often fairly easy to obtain when the amount of taxes you owe doesn’t exceed $25,000, and you have a qualified tax professional like Axiom Tax Resolution Group helping you file the necessary documentation. Even if you owe a larger amount, our CPA firm will work with the IRS to find the best solution to settle your tax debt. Contact us today!