What are my options if I can’t pay my tax bill in full?

Short-term payment plan

If you can afford to repay your tax bill in 180 days and owe less than $100,000, you can apply for a short-term payment plan online with no set-up fee. However, keep in mind that penalties and interest will be assessed on any unpaid tax, even with a payment plan in place.

Installment agreement

If you cannot afford to pay your tax within 180 days, you may consider signing up for an IRS installment plan, which allows you to pay over longer periods of up to 72 months. The IRS charges a set-up fee for long-term payment plans, and you’ll also have to pay penalties and interest for unpaid tax.

Temporary collections delay

If you’re unable to pay your tax due to a financial hardship, you can request that the IRS place your account in a “currently not collectible” status. You must provide the IRS with information about your finances and prove that you’re unable to pay your living expenses and taxes.

If the IRS grants your request, this status will pause any collection efforts but will not eliminate your tax debt. You’ll still owe taxes, and any penalties or interest will keep adding up.

Offer in compromise

If you can’t pay your tax and don’t believe you’ll ever be able to, you can request an offer in compromise. If the IRS accepts, this will allow you to settle your outstanding tax debt for less than you owe. Approval is based on your ability to pay, income, expenses, and assets.

The IRS will generally approve an offer in compromise when the amount you offer represents the most they can expect to collect within a reasonable time period.

You can confirm that you're eligible and prepare a preliminary proposal with the Offer in Compromise Pre-Qualifier Tool on IRS.gov.

Can’t pay your taxes? You have options, and we can help you find the best one for your needs. Book your appointment today.