The IRS has recently announced a set of relaxed rules on setting up Installment Agreements for individuals owing between $25,000 – $50,000. The IRS will no longer require a financial Collection Information Statement (Form 433-A or Form 433-F ), for these taxpayers and will allow them to setup streamlined installment agreements. This only applies if the taxpayer is willing to setup a Direct Debit Installment Agreement. The IRS has developed a new form: 9465-FS to be used for taxpayers meeting the above criteria. Additionally, the IRS will allow taxpayers the opportunity to pay the balance over a 72 month period, as opposed to the 60 month period that has been traditionally offered.
Form 9465-FS can be used by an individual who meets any of the following criteria:
- Who owes income tax on Form 1040,
- Who may be responsible for a Trust Fund Recovery Penalty,
- Who was self-employed and owes self-employment or unemployment taxes and is no longer operating the business,
- Who is personally responsible for a partnership liability and the partnership is no longer operating, or
- Owner who is personally responsible for taxes in the name of a limited liability company (LLC) and the LLC is no longer operating.
The instructions to this form can be found here: http://www.irs.gov/pub/irs-pdf/i9465fs.pdf