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What to Do If You Can’t Pay Your Tax Bill Right Away

  • Writer: Brian R. Schobel, CPA
    Brian R. Schobel, CPA
  • Apr 16
  • 2 min read

Tax season can come with surprises, especially when you find out you owe more than expected. If paying your tax bill in full isn’t an option right now, don’t panic. The IRS offers several solutions to help you manage your balance without falling deeper into trouble. Understand Your Tax Bill

The first step is to review your return or notice carefully. Make sure the amount due is accurate—sometimes a mistake or missing form can inflate the total. If you’re unsure, loop in a tax professional to help verify everything.


It's also important to remember: ignoring your bill won’t make it disappear. Delays will only rack up more interest and penalties.


Payment Options If You Can’t Pay in Full

  1. Short-Term Payment Extension: If you just need a little more time, the IRS allows up to 180 days to pay your bill in full without setting up a formal payment plan.


  2. Installment Agreement: You can apply for a monthly payment plan if your balance is under $50,000. The process is simple and can be completed online through the IRS Payment Plan portal.


  3. Offer in Compromise: In special cases where you’re facing serious financial hardship, the IRS might accept less than the full amount owed. This is rare and comes with strict qualifications, but it’s worth exploring if applicable.


  4. Currently Not Collectible (CNC) Status: If you're unable to pay due to financial hardship, the IRS may temporarily pause collection efforts. This status doesn’t erase your debt, but it buys you time.


Should You Use a Credit Card to Pay?

The IRS does accept credit card payments, but that doesn’t mean it’s always a good idea. Compare the interest rates and fees on your card with IRS penalties before deciding. In many cases, IRS payment plans are more affordable.


Planning Ahead

  • Stay Proactive: Don’t let a tax bill sit. Reach out early to discuss your options.

  • Keep Documentation: Maintain clear records of your payment plan agreements and payments made.

  • Review with a Professional: Every situation is unique. A tax advisor can help you determine the best course of action and avoid long-term consequences.


Conclusion

If you can’t pay your tax bill right away, you’re not alone—and you’re not out of options. The key is to stay ahead of the issue, know your choices, and reach out for professional help if needed. With a plan in place, you can tackle your tax bill without the stress. LinkedIn: https://www.linkedin.com/company/brs-cpa-at-bookkeepingbrian-com

 
 
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