Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about IRS Payment Plans and other Tax Relief topics.

What is the drawback to an IRS installment plan?

Drawback to IRS Installment Plans

The main drawback to entering into an installment agreement is the fact that interest and penalties still accrue on your unpaid tax bill.

The consequence of having a large unpaid tax bill combined with making small monthly installment payments is a larger tax bill.

On average, the IRS interest and penalties have a combined rate of anywhere from 9-12% per year. This can easily add up.

It is very frustrating to make monthly installment payments and see your IRS tax bill increasing. This is another reason to increase your monthly installment payment or to pay your tax bill in full.

Comments

10/14/2009 11:12:12 AM
pjyllis j johnson said:

I make payments to the irs and i would like to change the due date to later in the month. Mine are due on the 15th of the month.

Ask a Question

Not finding the advice and tips you need on this Tax Relief Tip Site? Request a Tip Now!

Guru Spotlight

Sherril Steele-Carlin

Ever wonder how you could make your life better and more fun? So have tens of millions of fans who have turned to LifeTips for answers over the past decade. We keep the tips, advice, books, podcasts and writing services flowing, so you can keep your life and business growing in the right direction. Upward!