26 USC 6159 - Agreements for payment of tax liability in installments

U.S Code last checked for updates: Nov 22, 2024

§ 6159.

Agreements for payment of tax liability in installments

(a)

Authorization of agreements

(b)

Extent to which agreements remain in effect

(1)

In general

(2)

Inadequate information or jeopardy

The Secretary may terminate any agreement entered into by the Secretary under subsection (a) if—

(A)

information which the taxpayer provided to the Secretary prior to the date such agreement was entered into was inaccurate or incomplete, or

(B)

the Secretary believes that collection of any tax to which an agreement under this section relates is in jeopardy.

(3)

Subsequent change in financial conditions

(4)

The Secretary may alter, modify, or terminate an agreement entered into by the Secretary under subsection (a) in the case of the failure of the taxpayer—

(A)

to pay any installment at the time such installment payment is due under such agreement,

(B)

to pay any other tax liability at the time such liability is due, or

(C)

to provide a financial condition update as requested by the Secretary.

(5)

Notice requirements

The Secretary may not take any action under paragraph (2), (3), or (4) unless—

(A)

a notice of such action is provided to the taxpayer not later than the day 30 days before the date of such action, and

(B)

such notice includes an explanation why the Secretary intends to take such action.

The preceding sentence shall not apply in any case in which the Secretary believes that collection of any tax to which an agreement under this section relates is in jeopardy.

(c)

Secretary required to enter into installment agreements in certain cases

In the case of a liability for tax of an individual under subtitle A, the Secretary shall enter into an agreement to accept the full payment of such tax in installments if, as of the date the individual offers to enter into the agreement—

(1)

the aggregate amount of such liability (determined without regard to interest, penalties, additions to the tax, and additional amounts) does not exceed $10,000;

(2)

the taxpayer (and, if such liability relates to a joint return, the taxpayer’s spouse) has not, during any of the preceding 5 taxable years—

(A)

failed to file any return of tax imposed by subtitle A;

(B)

failed to pay any tax required to be shown on any such return; or

(C)

entered into an installment agreement under this section for payment of any tax imposed by subtitle A,

(3)

the Secretary determines that the taxpayer is financially unable to pay such liability in full when due (and the taxpayer submits such information as the Secretary may require to make such determination);

(4)

the agreement requires full payment of such liability within 3 years; and

(5)

the taxpayer agrees to comply with the provisions of this title for the period such agreement is in effect.

(d)

Secretary required to review installment agreements for partial collection every two years

(e)

Administrative review

(f)

Installment agreement fees

(1)

Limitation on fee amount

(2)

Waiver or reimbursement

In the case of any taxpayer with an adjusted gross income, as determined for the most recent year for which such information is available, which does not exceed 250 percent of the applicable poverty level (as determined by the Secretary)—

(A)

if the taxpayer has agreed to make payments under the installment agreement by electronic payment through a debit instrument, no fee shall be imposed on an installment agreement under this section, and

(B)

if the taxpayer is unable to make payments under the installment agreement by electronic payment through a debit instrument, the Secretary shall, upon completion of the installment agreement, pay the taxpayer an amount equal to any such fees imposed.

(g)

Cross reference

(Added Pub. L. 100–647, title VI, § 6234(a), Nov. 10, 1988, 102 Stat. 3735; amended Pub. L. 104–168, title II, §§ 201(a), (b), 202(a), July 30, 1996, 110 Stat. 1456, 1457; Pub. L. 105–206, title III, §§ 3462(c)(2), 3467(a), July 22, 1998, 112 Stat. 766, 769; Pub. L. 105–277, div. J, title IV, § 4002(g), Oct. 21, 1998, 112 Stat. 2681–907; Pub. L. 108–357, title VIII, § 843(a), (b), Oct. 22, 2004, 118 Stat. 1600; Pub. L. 109–222, title V, § 509(c), May 17, 2006, 120 Stat. 363; Pub. L. 115–123, div. D, title II, § 41105(a), Feb. 9, 2018, 132 Stat. 157.)

cite as: 26 USC 6159