How IRS Payment Plans Protect You

When handled properly, an IRS installment agreement can:

• Stop bank account levies
• Prevent wage garnishments
• Protect accounts receivable (for businesses)
• Help avoid seizure of property, IRAs, and 401(k)s
• Move your case out of active collections

Once your request is pending or approved, the IRS is generally restricted from issuing new levies.

⚠️ The key: Your request must be accurate, complete, and processable.

How the IRS Determines Your Monthly Payment

Your payment is based on a financial analysis defined by the Internal Revenue Manual.

The IRS evaluates:

• Income
• Necessary living expenses
• Assets (including retirement accounts)
• Business cash flow (if applicable)

This determines your disposable income, which becomes your monthly payment.

👉 If calculated incorrectly, you could overpay significantly.

IRS Allowable Expense Standards

The IRS uses standardized expense limits such as:

• National Standards (food, clothing, healthcare)
• Local Standards (housing, utilities, transportation)

Only expenses considered necessary are allowed.

💡 Many taxpayers unknowingly leave money on the table without proper guidance.

Form 433-A vs. 433-B – What You Need to Know

Form 433-A (Individuals & Sole Proprietors)

Used for:

• Wage earners
• Self-employed individuals
• Schedule C taxpayers

Includes:

• Personal finances
• Business income (if applicable)
• Assets like IRAs and 401(k)s

Form 433-B (Businesses)

Used for:

• Corporations
• Partnerships
• LLCs

Includes:

• Business income and expenses
• Accounts receivable
• Payroll and operating costs

👉 These forms are critical—errors can lead to higher payments or rejection.

When You May Qualify for a Simplified IRS Payment Plan

You may qualify for simplified options such as:

• Streamlined Installment Agreements
• Simple Payment Plans
• Guaranteed Installment Agreements

These typically apply when balances are $50,000 or less.

Benefits may include:

• Faster approval
• No detailed financial disclosure
• Predictable monthly payments

👉 Choosing the wrong program can cost you.

Common Mistakes That Trigger IRS Enforcement

• Submitting incomplete or incorrect financial information
• Overstating income or understating expenses
• Choosing the wrong payment plan
• Failing to stay compliant with filings
• Ignoring IRS deadlines

🚨 These mistakes can lead to rejected agreements, levies, and increased pressure.

Why Timing Is Critical

The IRS moves quickly once collections begin.

Delays can result in:

• Frozen bank accounts
• Wage garnishments
• Asset seizure

Acting early can:

• ✔ Stop enforcement
• ✔ Protect your income
• ✔ Give you control

Get IRS Payment Plan Help Today

You don’t have to deal with the IRS alone.

At PFG Tax, we help taxpayers:

• Determine the best installment agreement
• Prepare Forms 433-A or 433-B correctly
• Reduce monthly payment amounts where possible
• Stop IRS levies and enforcement actions

Frequently Asked Questions

What is an IRS payment plan?

An IRS payment plan, also called an installment agreement, allows you to pay your tax debt over time in monthly payments.

Will an IRS payment plan stop levies?

Yes, once your request is properly submitted and accepted, the IRS generally cannot issue new levies.

Do I need to submit a 433-A or 433-B?

Individuals typically use Form 433-A, while businesses use Form 433-B. Some taxpayers qualify for simplified plans without these forms.

How much will my monthly payment be?

Your payment is based on your disposable income after allowable living expenses are applied.

Can the IRS take my retirement accounts?

Yes, in some cases. However, getting into a payment plan can help prevent seizure actions.