Video instructions and help with filling out and completing Fill Form 2220 Installment

Instructions and Help about Fill Form 2220 Installment

Hello Amanda Kendall Harris who result tax professionals today I'm coming to you I want to talk to you about the IRS Fresh Start initiatives so there's a lot of information out there on the Internet the IRS has some great information on this but I want to kind of break it down and just give you the overall view of what the Fresh Start initiatives really are that the IRS has put out there for us so the Fresh Start initiatives what those are is for installment agreements with the IRS so there's three different ways that you can set up installment agreements based on the amount you owe if you owe more than these amounts then you're most likely not going to qualify for one of the Fresh Start installment agreements but you can't qualify for another installment agreement so the first one we're going to talk about is our $25,000 or less tax liability and how that works for you so with the $25,000 tax liability you can do an installment agreement over five years and 60 months so what that's going to be is that's going to be an installment agreement that you need to do as a Direct Debit out of your bank account if you Oh less than this amount after three months of payments come out of your direct debit so not that you've made three payments not that you've made the equivalent of three payments and one lump sum but after three payments come directly out of your bank account you can actually have a lien withdrawal done on any tax liens that have been filed on you by the IRS a lien withdrawal is much better than a lien discharge or paying off a lien this actually allows you to provide this to the credit bureaus and have it removed from your credit report as if it was filed an error and it should have never been there so if your credit is an issue with the IRS tax lien this is a great way to go off you'll less than $25,000 the other option we have is our $50,000 or less tax liability this agreement is going to allow you to do an agreement over six years 72 months and pay that a male off over that time if you can come up with a payment that's going to pay that off within that time the IRS hasn't been asked go through financial information they're not going to ask any questions on what it is you can afford if you can afford that amount they're gonna be willing to do that this again also has to be a direct debit installment agreement so you'll want to make sure you have your bank account information ready when you're sending this over to the IRS to set this up the last version here is what we're calling the expanded streamlined installment agreement this is a new one that the IRS has rolled out within the last year or so here and what this is is this is a seven year agreement so over eighty four months and allows you to make this payment over eighty four months again this is going to have to be a direct debit installment agreement direct debit installment agreements are all set up using form 433 D so you're gonna want to make sure you have that form that it's completed and filled out when you're calling the IRS to go over this the only thing you're not gonna want to fill out on this form ahead of time is going to be the dollar amount and the reason being is because on all three of these agreements the dollar amount that you're paying off has to include the penalties and interest as they're going to accrue over the five six or seven year period to set this up what you want to be very careful of and this is what I run into all the time is on this one here where you're looking for the lien withdrawal you want to make sure that when you set this up that you're letting the agent or the representative that you get on the phone at the IRS know that you are going to be attempting the lien withdrawal and so you need to make sure this amount includes all accruals over the five years so that it can all still be paid off within that sixty months the mistake that I see happening here and not so much on taxpayers side but on the IRS side is that a disagreement is getting set up and when it's getting set up they're not accounting for accruals of interest and penalties over the five years so when you get to the point of submitting the lien withdrawal request you now have an issue with that Department the advisory group saying it's not going to full pay and you need to increase your payment by X amount of dollars you then have to increase your payment and your three-month payment window starts all over again so it's really important to make sure that this amount going to include all the curls to ensure that you can get the lean withdrawal taken care of they're a safe bet here is if you're able to on whatever they tell you this $25,000 is whatever that installment agreement is if you're able to bump that up by 50 to $75 a month from what they're asking for you're gonna be pretty safe on this here when you get to that point of requesting that lean withdrawal if you have questions on the lien withdrawal I'll be doing another video on that and I will drop the link in the comments below so that you can access that one form for 33d is a pretty simple form I'll also be doing a video on that one and drop the link for that in