Whenever a taxpayer has a back tax problem, they must make sure that they deal with it right away. The first IRS program that many people go to is the Offer in Compromise program. But considering that approximately 85% of taxpayers with back tax issues do not qualify for an offer in compromise, negotiating an installment agreement may be the next best thing.

The installment agreement process is much easier to complete than an offer in compromise. The installment agreement allows the IRS to set a monthly payment plan with the taxpayer that is determined by examining the taxpayer’s liability and comparing that to how much they can afford to pay on a monthly basis.

Installment payments must be paid timely and to the proper address. Don’t fall behind on your installment payments, as this is an agreement between you and the IRS. If you don’t fulfill your end of the agreement the IRS will instigate collection procedures again. It will be more challenging to negotiate an agreement the next time.

Just make sure that before you initiate an agreement you make sure that you are current on all income tax filings. The IRS will certainly make this a condition of the agreement and you won’t have much of a choice in the matter.

By aggressively negotiating with the IRS and working diligently, most taxpayers with back tax issues can reach an installment agreement. The goal is to make sure that you get an agreement that works within your financial budget.