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Tax & AccountingJanuary 25, 2023

IRS makes permanent flexible installment payment options for some individuals and sole proprietors

Individuals and sole proprietors who are no longer in business and who owe $250,000 or less in taxes may create a customized installment payment plan that satisfies their liabilities by the end of the collection statute period - with no financial statement required.  

The IRS has made this installment payment option permanent after receiving positive feedback from tax professionals and taxpayers.

More detail about the two-year IRS pilot program.

During the last two years, the IRS piloted a program that provides more flexible installment agreements for individual taxpayers and sole proprietors who are no longer in business.  

Specifically, individuals and sole proprietors who have gone out of business and owe $250,000 or less can opt to establish a payment plan. The payment plan will satisfy their liability as long as the tax debt is fully paid off within the statutory collection period. Further, this program does not require a financial statement to be submitted.  

Darren John Guillot, Deputy Commissioner, Small Business/Self Employed Division, Collection & Operations Support, states that “this option is available only when working with Campus Collection. It allows taxpayers to set their own monthly payment amount and resolve their tax debt in a timeframe that works for them, but is within the statutory period. The key is to be proactive and resolve your tax balance early - before enforcement and/or assignment to the Field. A Notice of Federal Tax Lien determination is still required.” 

For more information about collections, read IRS topic 201: the Collection Process.

What is a Notice of Federal Tax Lien (NFTL)?

A Notice of Federal Tax Lien (NFTL) is a document publicly filed with state and local jurisdictions to put other creditors on notice of the IRS’s lien interest. As a result, the NFTL does not actually create the lien – it merely informs others of a lien already existing by statute.

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Mark Friedlich
Vice President of US Affairs for Wolters Kluwer Tax & Accounting
Mark Friedlich, a CPA & tax lawyer, is the Vice President of US Affairs for Wolters Kluwer Tax & Accounting. He is a member of the U.S. Senate Finance Committee’s Chief Tax Counsel’s Advisory Board, advisor to 14 state taxing authorities, and has been a member of the American Bar Association’s Tax Section and AICPA’s Tax Section leadership teams. Prior to joining Wolters Kluwer he was a COO and Principal at PwC.


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