The IRS has just issued new rules expanding the streamlined installment agreement. A new program was announced that will run through September 30, 2017. Under the test program, the IRS doubled the dollar limit applicable to streamline installment agreements from $50,000 to $100,000.
This program provides that the payoff must occur within 84 months or within the time left on the collection statute of limitations. The Taxpayer must agree to pay by direct debit from a bank account or through a payroll deduction agreement with an employer. A direct debit is provided for on IRS Form 433-D, Installment Agreement; the payroll deduction is established with IRS Form 2159.
The IRS has discretion whether to file a Notice of Federal Tax Lien. Tax Crisis Institute recently set up an installment agreement where we paid down the tax debt to $100,000, set up the direct debit installment agreement and there was no tax lien.
If a Taxpayer does not agree to automatic payments, he or she must submit financial information, Collection Information Statement Form 433-A. The living standards the IRS allows on this form are quite miserly. The beauty of the streamlined program is a high income tax payer can qualify for the program regardless of income.
This expanded Streamlined Installment Agreement is only available through the IRS automatic collection site also known as ACS. Revenue Officers are regrettably not following these rules at this time. Success with this new expanded program at the phone site level will hopefully lead IRS to change it’s collection policies in the field with Revenue Officers.