26 U.S.C. § 6159 — Agreements for payment of tax liability in installments
submitted 38 years ago by Pub. L. 100-647 to r/title-26-INTERNAL-REVENUE-CODE · 826 words · no verdicts yet
The Secretary may make installment agreements when they will help collect tax. The section sets rules for changing or ending agreements, requires certain qualifying individual agreements, and provides review and fee rules.
(a) The Secretary* may make a written agreement allowing a taxpayer* to pay tax in installments if the Secretary decides it will help collect all or part of the liability. (b) An agreement normally lasts for its stated term. The Secretary may end it if information supplied before the agreement was inaccurate or incomplete, or collection is in jeopardy. If the taxpayer’s financial condition significantly changes, or the taxpayer misses an installment, misses another tax payment, or fails to provide a requested financial update, the Secretary may alter, modify, or end it. Except in a jeopardy case, the Secretary must give at least 30 days’ notice explaining the planned action. (c) For an individual’s subtitle A liability, the Secretary must accept full payment by installments if the liability excluding interest and penalties is no more than $10,000; the individual and, for a joint return*, spouse did not in the prior five taxable years fail to file or pay subtitle A tax or enter such an agreement; the Secretary finds the individual cannot pay in full when due based on required information; the agreement requires full payment within three years; and the taxpayer agrees to follow title 26 during the agreement. (d) The Secretary must review an agreement for partial collection at least every two years. (e) The Secretary must provide independent administrative review when a taxpayer requests review of termination. (f) An installment-agreement fee cannot exceed its amount when this subsection was enacted. For a taxpayer whose available adjusted gross income does not exceed 250 percent of the applicable poverty level, no fee applies if payments are by electronic debit; otherwise the Secretary must reimburse the fees after completion. (g) Section 7122(e) concerns administrative review and appeal.
The Secretary* is authorized to enter into written agreements with any taxpayer* under which such taxpayer is allowed to make payment on any tax in installment payments if the Secretary determines that such agreement will facilitate full or partial collection of such liability.
Except as otherwise provided in this subsection, any agreement entered into by the Secretary under subsection (a) shall remain in effect for the term of the agreement.
The Secretary may terminate any agreement entered into by the Secretary under subsection (a) if—
information which the taxpayer provided to the Secretary prior to the date such agreement was entered into was inaccurate or incomplete, or
the Secretary believes that collection of any tax to which an agreement under this section relates is in jeopardy.
If the Secretary makes a determination that the financial condition of a taxpayer with whom the Secretary has entered into an agreement under subsection (a) has significantly changed, the Secretary may alter, modify, or terminate such agreement.
The Secretary may alter, modify, or terminate an agreement entered into by the Secretary under subsection (a) in the case of the failure of the taxpayer—
to pay any installment at the time such installment payment is due under such agreement,
to pay any other tax liability at the time such liability is due, or
to provide a financial condition update as requested by the Secretary.
The Secretary may not take any action under paragraph (2), (3), or (4) unless—
a notice of such action is provided to the taxpayer not later than the day 30 days before the date of such action, and
such notice includes an explanation why the Secretary intends to take such action.
The preceding sentence shall not apply in any case in which the Secretary believes that collection of any tax to which an agreement under this section relates is in jeopardy.
In the case of a liability for tax of an individual under subtitle A, the Secretary shall enter into an agreement to accept the full payment of such tax in installments if, as of the date the individual offers to enter into the agreement—
the aggregate amount of such liability (determined without regard to interest, penalties, additions to the tax, and additional amounts) does not exceed $10,000;
the taxpayer (and, if such liability relates to a joint return*, the taxpayer’s spouse) has not, during any of the preceding 5 taxable years—
failed to file any return of tax imposed by subtitle A;
failed to pay any tax required to be shown on any such return; or
entered into an installment agreement under this section for payment of any tax imposed by subtitle A,
the Secretary determines that the taxpayer is financially unable to pay such liability in full when due (and the taxpayer submits such information as the Secretary may require to make such determination);
the agreement requires full payment of such liability within 3 years; and
the taxpayer agrees to comply with the provisions of this title for the period such agreement is in effect.
In the case of an agreement entered into by the Secretary under subsection (a) for partial collection of a tax liability, the Secretary shall review the agreement at least once every 2 years.
The Secretary shall establish procedures for an independent administrative review of terminations of installment agreements under this section for taxpayers who request such a review.
The amount of any fee imposed on an installment agreement under this section may not exceed the amount of such fee as in effect on the date of the enactment of this subsection.
In the case of any taxpayer with an adjusted gross income, as determined for the most recent year for which such information is available, which does not exceed 250 percent of the applicable poverty level (as determined by the Secretary)—
if the taxpayer has agreed to make payments under the installment agreement by electronic payment through a debit instrument, no fee shall be imposed on an installment agreement under this section, and
if the taxpayer is unable to make payments under the installment agreement by electronic payment through a debit instrument, the Secretary shall, upon completion of the installment agreement, pay the taxpayer an amount equal to any such fees imposed.
Source credit: (Added Pub. L. 100–647, title VI, § 6234(a), Nov. 10, 1988, 102 Stat. 3735; amended Pub. L. 104–168, title II, §§ 201(a), (b), 202(a), July 30, 1996, 110 Stat. 1456, 1457; Pub. L. 105–206, title III, §§ 3462(c)(2), 3467(a), July 22, 1998, 112 Stat. 766, 769; Pub. L. 105–277, div. J, title IV, § 4002(g), Oct. 21, 1998, 112 Stat. 2681–907; Pub. L. 108–357, title VIII, § 843(a), (b), Oct. 22, 2004, 118 Stat. 1600; Pub. L. 109–222, title V, § 509(c), May 17, 2006, 120 Stat. 363; Pub. L. 115–123, div. D, title II, § 41105(a), Feb. 9, 2018, 132 Stat. 157.)
- 1988Enacted · Pub. L. 100-647 · 102 Stat. 3735
- 1996Amended · Pub. L. 104-168 · 110 Stat. 1456, 1457
- 1998Amended · Pub. L. 105-206 · 112 Stat. 766, 769
- 1998Amended · Pub. L. 105-277 · 112 Stat. 2681
- 2004Amended · Pub. L. 108-357 · 118 Stat. 1600
- 2006Amended · Pub. L. 109-222 · 120 Stat. 363
- 2018Amended · Pub. L. 115-123 · 132 Stat. 157
A history note hasn’t been published yet. The record shows enactment by Pub. L. 100-647 on 1988-11-10.
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