IRS Installment Agreement or Payment Plan Paused? Resume Payments July 15

People First Initiative

IRS Installment Agreement or Payment Plan Paused? Resume Payments July 15

Starting Wednesday, July 15 the IRS’s “People First Initiative”, enacted to protect American’s during the COVID-19 crisis will expire. The “People First Initiative” paused accounts which were utilizing an installment agreement or payment plan from April 1, 2020 – July 15, 2020. The act allowed tax payers in financial distress due to COVID-19 to pause their accounts and suspend payments during that time with no penalties.

Taxpayers will need to restart their IRS Installment Agreements, Offers in Compromise or Private Debt Collection program payments to avoid any penalties.

Installment Agreements

Under the “People First Initiative” the IRS didn’t default agreements, but balances remained the same and accrued interest. Taxpayers should begin making payments by their next due date after the 15th. If you suspended automatic bank payments, be sure to contact your bank to resume automatic monthly payments towards your agreement. If you are still facing financial hardship due to COVID-19 they can revise the agreement or contact the IRS directly to do so.

Offer in Compromise

Pending Offers: If the IRS is currently reviewing your Offer in Compromise but hasn’t accepted it, you should restart the required payments on July 15,  2020. If the offer is accepted, the IRS will amend the taxpayer’s offer and allow them to pay missed payments at the end of the offer period.

Accepted offers: If a taxpayer has an Offer in Compromise, and they were unable to make the payments because of a COVID-19 hardship, they should restart payments and make up the missed payments by July 15, 2020. If the taxpayer can’t to make up the missed payments, they should call the number on the IRS notice to discuss their situation.

Private Debt Collection

The IRS didn’t forward any new delinquent accounts to private debt collection agencies from April 1 to July 15, 2020. Taxpayers should begin payments to private debt collections by July 15. They should also work with their collection agency to establish a new payment arrangement or restructure their existing one based on their current situation.

Other payment options

If you are a taxpayer that owes but cannot pay or has questions regarding payments you can call the number on your notice. Please know that you may experience a long wait time due to high call volume to the IRS.

 

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