#collectionstatute

Similar to a Regular Installment Agreement, a Partial-Pay Installment Agreement (“PPIA”) is reached when a taxpayer provides financial information to the IRS and the information shows that the taxpayer can make payments but they will not result in full-payment of the tax liability within the time remaining on the collection statute. 

When a taxpayer’s RCP  "Reasonable Collection Potential" analysis indicates that they can make payments, but those payments will not be enough to full-pay the liability within the time remaining on the Collection Statute, the IRS will still agree to the payment plan. These agreements, called “partial-pay” installment agreements, will be just like a regular agreement except that the IRS will revisit the taxpayer every 18 months or so to see if the taxpayer’s ability to pay has improved.

Christopher G. Carmona CPA,CFE

http://carmonataxcpa.com/

https://twitter.com/CarmonaChristo

https://business.google.com/u/1/posts/l/12878835146959315208

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The IRS will not consider an OIC if the taxpayer shows the ability to full-pay the liability within the time remaining on the statute. It is therefore critical that you look at how much time remains on the collection statute and calculate if the taxpayer could full pay the liability. 

To do this you need to look at the net equity calculated from assets and assume the taxpayer made their future income payments until the end of the statute. If the taxpayer’s equity in assets and future income will cover the liability within the time remaining, then the taxpayer is not considered eligible to file an OIC. The taxpayer would be required to get into an installment agreement. 

Christopher G. Carmona CPA,CFE

http://carmonataxcpa.com/

https://twitter.com/CarmonaChristo

https://business.google.com/u/1/posts/l/12878835146959315208