The IRS has dramatically increased the fees on installment agreements. Effective January 1st, 2017, the fees for regular installment agreements have gone from $107 tp $225 and the fees for Direct Debit installment agreements has gone from $52 to $107.
The fees for direct debit online installment agreements are only $31. Direct debit installment agreements online are the way to go. If you choose the online option, but do not elect direct debit your fee will be $107.
The IRS does continue to provide reduced fee or no fee services to low income taxpayers. There is no change to the present $43 that currently applies to low income taxpayers. About one in three taxpayers qualify for the low income guidelines.
There is uncertainty about what tax debts qualify to online installment agreements and what the dollar maximum is for such installment agreements. Does the new streamlined installment agreement 100 K limit qualify? Dan Pilla of Tax Freedom Institute points out “for sure you can do an online installment agreement for payroll taxes” The streamlined installment agreement for such payroll tax, however, is $25,000 or less.