I Can't Pay the IRS: What Are My Options?
If you owe the IRS and cannot pay in full, you're not alone—and you have more options than you might think. From payment plans to hardship programs, the IRS has solutions for people who genuinely cannot pay. The key is requesting a hold immediately and exploring your options before levies begin.
Need Immediate Help?
Our tax professionals can contact the IRS today and request a hold on collections while we review your situation.
No obligation. We will review your case and contact you.
Levies & Garnishment
Quick Answer: What Happens If You Can't Pay?
- You have options, but timing matters. Acting before a Final Notice gives you the best outcomes.
- A payment plan can stop levies. Many people can afford manageable monthly payments.
- Hardship programs exist. Currently Not Collectible status suspends enforcement if you have documented hardship.
- A hold buys you time. Request one immediately while exploring solutions.
Your Options When You Can't Pay
Option 1: Installment Agreement (Payment Plan)
Pay your debt in monthly installments instead of a lump sum. The IRS will work with most people to establish affordable payment arrangements.
- • Pros: Stops all levies, spreads payments over time (typically 3-72 months), affordable
- • Cons: You must make payments consistently; interest and penalties continue to accrue
- • Setup fee: $31-$225 depending on type
- • Best for: People who can afford monthly payments but not lump sum
Option 2: Currently Not Collectible (CNC) Status
The IRS temporarily suspends collection efforts while you're in financial hardship. Penalties and interest continue to accrue, but enforcement stops.
- • Pros: Stops levies and garnishments, no payments required, temporary relief
- • Cons: Debt grows due to interest/penalties, status re-evaluated every 120 days
- • Requirement: Must document severe financial hardship
- • Best for: People facing genuine temporary hardship (job loss, medical emergency)
Option 3: Offer in Compromise (OIC)
Settle your tax debt for less than you owe if you meet specific criteria. Rarely approved but worth exploring if debt is very large.
- • Pros: Resolve debt for fraction of amount owed
- • Cons: Rarely approved, requires extensive documentation, application fee ($225)
- • Requirement: Must prove financial hardship and that debt is uncollectible
- • Best for: Large debts with documented financial hardship
Option 4: Collection Hold
A temporary pause on enforcement while you determine your best path forward. Buys you time to explore permanent solutions.
- • Duration: Typically 30, 60, or 90 days (can be extended)
- • Effect: Stops levies and garnishments temporarily
- • Purpose: Immediate relief while working toward permanent solution
Which Option Is Right for You?
- Choose Payment Plan if: You can afford monthly payments but not the full amount; you want to definitively stop levies.
- Choose CNC if: You cannot afford any payments; you're facing temporary hardship (job loss); you need immediate relief while you stabilize.
- Choose OIC if: Your debt is extremely large; you can document severe hardship; you cannot pay even a small percentage of debt.
- Choose Hold if: You need immediate relief to prevent levies while determining which of the above is best for you.
Real Scenarios: What Works
Scenario 1: Payment Plan Works
David owes $18,000. He cannot pay in full, but he can afford $350/month. The IRS approves a 60-month payment plan. Levies stop. He pays off the debt in 5 years.
Scenario 2: CNC Works
Jennifer lost her job. She can't pay anything. She requests CNC status with documentation of job loss and zero income. The IRS grants 120-day CNC. She finds work, stabilizes, then explores payment plan options.
Why Acting Early Matters
- •Before levies: Full range of options available, easier to qualify for programs.
- •After levies: Options still exist, but urgency increases, negotiating position weakens.
- •Waiting makes debt worse: Interest and penalties grow daily, options narrow.
We Evaluate Your Situation and Request a Hold Immediately
We listen to your situation, determine which option gives you the best outcome, and contact the IRS immediately to request a hold while we work toward a permanent solution.
Need Immediate Help?
Our tax professionals can contact the IRS today and request a hold on collections while we review your situation.
No obligation. We will review your case and contact you.
Levies & Garnishment
You Have Options—Let's Explore Them
Not being able to pay the IRS is stressful, but it doesn't mean you're stuck. Payment plans, hardship programs, and holds are real options that can stop enforcement and give you a path forward. The first step is a free consultation to understand your best options.
Need Immediate Help?
Our tax professionals can contact the IRS today and request a hold on collections while we review your situation.
No obligation. We will review your case and contact you.
Levies & Garnishment
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