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Level 2
posted Apr 4, 2021 10:51:28 AM

Short-term payment plan if i own more than $100,000 in 2020?

I owns around $128,000 federal tax in 2020. I don't have enough cash to pay it. I found the Short-term payment plan, however, it requires:

 

You may qualify to apply online if:

  • Long-term payment plan (installment agreement): You owe $50,000 or less in combined tax, penalties and interest, and filed all required returns.
  • Short-term payment plan: You owe less than $100,000 in combined tax, penalties and interest.

 

Can I pay some (like $50,000) of my tax liability and pay the rest ($78,000) with the Short-term payment plan?

 

Thanks,

0 5 744
5 Replies
Expert Alumni
Apr 4, 2021 11:15:00 AM

Yes, if you make a paydown of the taxes owed first, you can include the remainder on the Installment Agreement. 

Level 2
Apr 4, 2021 11:36:17 AM

Hi Mary,

Thanks for your response.

 

Does TurboTax Desktop version support this feature?

 

 

Expert Alumni
Apr 4, 2021 1:31:00 PM

Yes, if you have not filed your return yet, see Can I file a Form 9465 (Installment Agreement?. 

 

@goblueping

Level 2
Apr 4, 2021 2:25:06 PM

@MaryK4 Thanks. I have not filed by tax yet.

 

I tried in the TurboTax. It asked me to contact the IRS about the installment payment plan.

I also found a post: 

2. Pay some of the tax you owe

If you can afford to pay some, send it by May 17. The penalty for not paying your taxes depends on the total tax you owe. If you pay some now, the penalty will be smaller later.

You can make a partial payment with TurboTax. In the File section, select I will mail a check. If you choose to pay with your bank account or credit card, TurboTax will charge the total tax due.

 

Does this mean i need to do these steps:

1. Choose I will mail a check as my payment method and in the check, i  will write ~ $50,000.

2. Go to IRS website to Apply Online for a Payment Plan:

Since my check will cover ~$50,000, then in my application for a short term payment plan, I can input $TotalAmount - $50,000 as the amount that I own.

 

Does this look right to you?

 

 

Thanks 

Expert Alumni
Apr 5, 2021 2:48:49 PM

Yes, that is correct, you enter the amount you will owe after your make the $50,000 payment as the amount you want to have considered for the payment plan.