On this months EO Fire income report I talked about why it’s much better to set up a payment plan with the IRS than to extend your return and not pay the taxes due by April 15. John came up with the great idea to do a walk through of how the process works.
Choose option 2 for individual tax questions.
Choose option 1.
Choose option 3.
Choose option 2.
Then you will put in your social security number.
Choose option 1 to set up a payment plan. Then choose option 1 again that you agree with the amount due and want to set up a payment plan.
- Note that these menu options change often. The key is to remember that you are trying to talk to someone about your INDIVIDUAL taxes, NOT business taxes. I know it’s confusing because the amount due is because of your business, but your business doesn’t owe the taxes you do.
Once you finally have someone on the phone they will go through all the typical identity verification stuff and then will ask you when you filed and how much you owe. You need to have the exact amount due ready to give them so make sure you have that exact number before calling. Also remember this is JUST your IRS amount due, not your state or local amounts due.
After you tell them how much you owe they will ask how much you want to pay per month. As long as the amount you give them allows the debt to be paid off within five years they will generally agree to it.
One last tip here. If you get an IRS agent on the phone who is not easy to work with and making things more difficult than I laid out here, simply hang up and call back. Most IRS agents are good people and willing to help where they can. Some hate their jobs and will take it out on you. Don’t bother dealing with those people, just hang up and call back to get someone else.
As long as you owe less than $50,000 this process will be surprisingly simple to complete. And most importantly make sure you plan better in 2017 so that you are prepared for the taxes owed!