Did you know that the IRS permits some taxpayers to make minimal payments and never repay the tax? The government doesn’t promote this solution, and yet it’s benefited many of our clients. The taxpayer may eventually walk away free and clear of any further obligation to the government.
This tax solution is called the partial pay installment agreement, or “partial pay” for short. Agreements that do not pay the IRS in full are permitted by the Internal Revenue Manual 5.14.2. Pursuant to Internal Revenue Code 6159(a), the IRS may enter into an agreement that allows full or partial collection of the unpaid tax liability.
You don’t often hear about partial pay because neither the “tax resolution” companies nor the IRS promote it. For some clients, partial pay is the ideal solution. As long as you make the minimal payments, the IRS will leave you alone.
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