If your small business is having trouble paying payroll taxes, and is behind on payments, you may be able to qualify for an IRS In-Business Trust Fund Express Installment Agreement (otherwise known as an IBTF Express IA). If you owe $25,000 or less you can have up to 24 months to pay your payroll taxes to the IRS. This agreement is one of the IRS's "Fresh Start" agreements, to help taxpayers pay off tax debts.
The IRS describes the criteria to qualify for an IBTF-Express IA:
- You owe $25,000 or less at the time the agreement is established. If you owe more than $25,000, you may pay down the liability before entering into the agreement in order to qualify.
- The debt must be full paid within 24-months or prior to the Collection Statute Expiration Date (CSED), whichever is earlier.
- You must enroll in a Direct Debit installment agreement (DDIA) if the amount you owe is between $10,000 and $25,000.
- You must be compliant with all filing and payment requirements. (In other words, you must stay up to date with filings and payments during the agreement period.)
Your business generally does not need to submit financial statements or provide financial verification as part of the application process.
To Request an In-Business Trust Fund Express Installment Agreement:
- Call the number on your bill or 1-800-829-4933.
- Visit your local IRS office.
- Complete IRS Form 9465, Installment Agreement Request (PDF), and send it to the address on your bill. If you do not have a bill, send the form to the address on page 2 of the Instructions for Form 9465 (PDF).
Before you agree to sign this agreement, talk to your tax advisor to make sure it will benefit you from a cash flow standpoint. For example, paying off the excess over $25,000 at one time might cause problems. Of course, this agreement might be your only alternative to massive fines and penalties for unpaid payroll taxes.