Refund and Amount of Tax Owed
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Taxpayers who cannot pay the full amount owed, shown on Form 1040 in the Amount You Owe section,
may use one of the following options:
• Pay in full within 120 days using the Online Payment Agreement Application (OPA) or calling. No fee is
charged, but interest and penalties are charged on payments after the April due date.
• Monthly installment payments (established online using OPA or le Form 9465, Installment Agreement
Request). A fee is charged for this option, in addition to interest and penalties.
• Referral to Low-Income Taxpayer Clinics (LITC). Services are oered for free or a small fee.
Any
amount of tax owed that is not paid by the
April due date is subject to penalties and interest. T
axpayers
who cannot pay should choose the option that is the least costly. For example, the 120-day pay-in-full option has no
user fee. Print extra vouchers for taxpayers who need to send in multiple payments.
Taxpayers who can show they will have a substantial nancial diculty if they pay their tax on the due date
are considered to have an undue hardship. Such taxpayers can request an extension of time to pay by ling Form
1127, Application for Extension of Time for Payment of Tax Due to Undue Hardship, by the due date of the return.
Remember, undue hardship is more than an inconvenience.
How do I handle Form 9465, Installment Agreement Request?
The following outlines key information related to an installment agreement.
• Taxpayers who owe can immediately establish an installment agreement online, using the Online
Payment Agreement Application (OPA) on irs.gov. Taxpayers can also use OPA to agree to pay in full in
up to 120 days. With OPA, there is no need to complete Form 9465. For more information, go to
https://www.irs.gov and search for the term “OPA.”
• If the return is being led electronically, Form 9465 can also be included with the e-led return Refer to
the Volunteer Resource Guide, Tab K, Finishing the Return.
• When ling a paper return, Form 9465 should be completed and attached to the front of the return
before mailing.
• If taxpayers already have an installment agreement with the IRS, they may be able to add the current
year’s amount owed to the same agreement. Taxpayers in this situation should contact the IRS directly
at 1-800-829-1040 or complete Form 9465 reecting the balance of all amounts (prior and current year
amounts) and indicate the new total monthly payment. Submit Form 9465 electronically with the return.
• If the request is granted, the taxpayers must pay an installment agreement user fee. The amount of
the fee varies depending on whether the agreement was setup online or the taxpayer agreed to pay
by direct debit. If the taxpayers’ income is below certain limits, they may qualify for a reduced fee.
Taxpayers can also request a reduced user fee by completing Form 13844, Application for Reduced
User Fee for Installment Agreement. Taxpayers can obtain Form 13844 at irs.gov or by calling the IRS
forms number at 1-800-829-3676. The fee for establishing an installment agreement using OPA on irs.
gov is lower.
• If the IRS approves the agreement, a notice is issued that provides details of the agreement and
requests the user fee at that time.
• If the total amount due is more than $25,000, there are additional requirements. Refer to Form 9465
instructions.
Some low-income taxpayers may qualify for a modication of user fee requirements. The IRS will waive or
refund user fees associated with installment agreements for taxpayers who earn less than 250% of the federal
poverty rate. For details, see User fee waivers and refunds on irs.gov.