Installment Agreement
An installment agreement is an IRS payment plan that allows taxpayers to pay their tax debt over time in monthly installments, with several types available depending on the amount owed.
Exam Tip
Guaranteed: owe ≤$10,000, prior 5-year compliance and no installment agreement; full payment within 3 years. Streamlined: owe ≤$50,000, pay within 72 months. User fees: $22-$178 (2025 cutoff) depending on type. Penalties and interest continue accruing.
EA exam baseline: For the 2026–2027 SEE, use Tax Year 2025 and federal tax law through December 31, 2025. Later-year amounts below are explicitly labeled comparisons, not the default exam year. IRS SEE policy.
What is an Installment Agreement?
An IRS installment agreement allows taxpayers who cannot pay their full tax liability to make monthly payments over time. Interest and penalties continue to accrue on the unpaid balance.
Types of Installment Agreements
| Type | Requirements | Terms |
|---|---|---|
| Guaranteed | Owe ≤ $10,000 | Prior 5-year filing/payment compliance and no installment agreement; full payment within 3 years |
| Streamlined | Owe ≤ $50,000 | Pay within 72 months |
| Non-streamlined | Owe > $50,000 | Financial disclosure required |
| Partial payment | Cannot pay in full | Reviewed every 2 years |
User Fees
| Setup Method | Fee |
|---|---|
| Online (direct debit) | $22 |
| Online (other) | $69 |
| Phone/mail/in-person, direct debit | $107 |
| Phone/mail/in-person, other | $178 |
| Low-income | Reduced or waived |
Exam Alert
Guaranteed installment agreement: owe $10,000 or less AND prior 5-year filing/payment compliance, no installment agreement during that period, and full payment within 3 years. Streamlined: $50,000 or less, paid within 72 months. Penalties and interest continue accruing during the agreement. A filed NFTL may still apply.
2025 EA Exam Notes
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Offer in Compromise (OIC)
An Offer in Compromise is an agreement between a taxpayer and the IRS that settles tax debt for less than the full amount owed, available when the taxpayer cannot pay in full or when there is a legitimate dispute.
Enrolled Agent (EA)
An Enrolled Agent is a federally authorized tax practitioner who has earned the privilege of representing taxpayers before the IRS by passing the Special Enrollment Examination (SEE) or through IRS experience.
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