| Do you owe the IRS back taxes? In this case, you | | | | Why would an installment agreement be a bad idea? |
| need to pay them as soon as humanly possible. That | | | | For one, you will also have to pay interest and |
| being said, you need to ask yourself this question: can I | | | | penalties to the IRS. In other words, not only are you |
| afford to pay the IRS all the money I owe at once? If | | | | paying back taxes, which you legitimately owe, but you |
| you can send a lump payment you should do so. This | | | | are also going to get hit with other fees that will |
| will get you out of hot water with the IRS, and allow | | | | increase the total out of pocket amount. Even though |
| you to forget about your situation. If this does not work | | | | you have to pay more, if this is your only option it is |
| for you, there are other options although they may not | | | | why you need to do. |
| be nearly as intriguing. | | | | Once you know how much money you owe the IRS |
| Using an installment agreement is something you | | | | you can then decide if paying via an installment |
| should not overlook. The nice thing about this option | | | | agreement is the best option. If you compare this to |
| offered by the IRS is that you will not be responsible | | | | paying in full you will be able to clear see which one will |
| for paying your entire tax liability all at once. For | | | | work best. |
| example, if you owe $20k you can pay month by | | | | An installment agreement can be beneficial. Now that |
| month until the entire debt is wiped out. This is perfect | | | | you know when you can use this option it may come |
| for people who owe back taxes, but do not have the | | | | in handy in the future. |
| money in cash to pay all at once. | | | | |