What does Installment Agreement mean?
An installment agreement is a program offered by the Internal Revenue Service to allow a taxpayer to to satisfy a tax liability owed by paying the full balance over time through a series of payments rather than as a lump sum at the time the tax return is filed.
To be considered for an installment agreement, a taxpayer must submit the appropriate application form including the required application fee based on the type of installment agreement. In addition, the taxpayer must have filed all current tax returns due.
The Internal Revenue Service will continue to assess interest and penalties against the tax liability balance owed by the taxpayer while the application is being considered for approval.