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The IRS Has Proposed Increases in Installment Agreement Fees.

The IRS is proposing a revised schedule of user fees that would take effect on Jan. 1, 2017, and apply to any taxpayer who enters into an installment agreement.

The proposal, which is one of several user fee changes made this year, reflects the law that federal agencies are required to charge a user fee to recover the cost of providing certain services to the public that provides a special benefit to the recipient. Although some installment agreement fees are increasing, the IRS will continue providing reduced-fee or no-cost services to low-income taxpayers.

Installment Agreement Fees

The revised installment agreement fees of up to $225 would be higher for some taxpayers than those currently in effect, which can be up to $120. However, under the revised schedule any affected taxpayer could qualify for a reduced fee by making their request online using the Online Payment Agreement application on IRS.gov website. In addition, there would be no change to the current $43 rate that applies to the approximately one in three taxpayer requests that qualify under low-income guidelines. These guidelines, which change with family size, would enable a family of four with total income of around $60,000 or less to qualify for the lower fee. Also, for the first time, any taxpayer regardless of income would qualify for a new low $31 rate by requesting an installment agreement online and choosing to pay what they owe through direct debit.

The top rate of $225 applies to taxpayers who enter into an installment agreement in person, over the phone, by mail or by filing Form 9465 with the IRS. But a taxpayer who establishes an agreement in this manner can substantially cut the fee to just $107 by choosing to make their monthly payments by direct debit from their bank account.
Alternatively, a taxpayer who chooses to set up an installment agreement using the agency’s Online Payment Agreement application will pay a fee of $149. Similarly, they can cut this amount to just $31 by also choosing direct debit.

Proposed Fees

Here is the proposed schedule of user fees:

  • Regular installment agreement: $225
  • Regular direct debit installment agreement: $107
  • Online payment agreement: $149
  • Direct debit online payment agreement: $31
  • Restructured or reinstated installment agreement: $89
  • Low-income rate: $43

Further details on these proposed changes can be found in proposed regulations (REG-108792-16 in case you were wondering), now available in the Federal Register. The IRS welcomes comment on these changes, and a public hearing on the regulations will take place in Washington, D.C. For details on submitting comments, just take a look at the proposed regulations.

By law, federal agencies are required to charge a user fee to recover the cost of providing certain services to the public that confer a special benefit to the recipient. Installment agreements are an example of a service that confers a special benefit to eligible taxpayers. Agencies must review these fees every two years to determine whether they are recovering the costs of providing these services.

In the past, the IRS often charged less than the full cost for many services in an effort to make them accessible to a broader range of taxpayers. But given current constraints on agency resources, the IRS can no longer continue this practice in most cases.

Nevertheless, the IRS intends to continue providing reduced-fee or no-cost services to low-income taxpayers. For that reason, the IRS will continue subsidizing part of the cost of providing installment agreements to low-income taxpayers.

You can find out more information, on the IRS’ website, about the IRS User Fee Program.

If you are contemplating an Installment Agreement or have other issues regarding back taxes owed the IRS, give us a call at (845) 344-1040. We are here year-round to help you.

You can find out more about us on our website => SolidTaxSolutions.com.

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Bruce – Your Host at The Tax Nook

Our Firm’s Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Twitter: Twitter.com/@SolidTax1040 (BTW, We Follow-Back).

Are You Planning to Buy High End Residential Real Estate?

Even though this post is not directly about taxes I wanted to timely share information that could, under certain circumstances, affect a segment of the population as a result of a recent action by a bureau of the U.S. Treasury. Don’t worry, I’ll keep this article short.

The Financial Crimes Enforcement Network (FinCEN) has announced Geographic Targeting Orders (GTO) that will temporarily require U.S. title insurance companies to identify the natural persons behind shell companies used to pay “all cash” for high-end residential real estate in six major metropolitan areas. FinCEN remains concerned that all-cash purchases (i.e., those without any bank financing) may be conducted by individuals attempting to hide their assets and identity by purchasing residential properties through limited liability companies or other opaque structures. So to better understand this vulnerability, FinCEN issued similar GTOs earlier this year covering transactions in Manhattan and Miami-Dade County, Florida. The GTOs announced yesterday will expand upon the valuable information received from the initial GTOs. You can see the complete release here——> https://www.fincen.gov/news_room/nr/pdf/20160727.pd f.

So, I promised that I would keep this post short. But, I hope that this information is helpful to those potentially affected.

Stay tuned!

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Bruce – Your Host at The Tax Nook

Our Firm’s Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Twitter: Twitter.com/@SolidTax1040 (BTW, We Follow-Back).

2016 IS HERE!!!!!!!!!!

HAPPY NEW YEAR!

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Bruce – Your Host at The Tax Nook

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).

 

Merry Christmas!

On behalf of SOLID TAX SOLUTIONS and THE TAX NOOK I want to wish all of you a safe, happy and Merry Christmas to you and your family.

Oh, I almost forgot…………I have a Christmas card for you  —————–>Your Christmas Card!

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Bruce – Your Host at The Tax Nook

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).

 

Happy Thanksgiving!

On behalf of Solid Tax Solutions, I would like to wish our clients and friends a very Happy Thanksgiving.

Enjoy your Thanksgiving, watch some football, eat too much turkey, and enjoy time with your family.  It will definitely be a time to relax and enjoy life for a couple of days (unless you are thinking of getting to the stores early for some of the Black Friday sales!)

But remember, there are only 35 more days remaining in 2015 before the new year starts.  So after the long Thanksgiving weekend is over, it will be time to start thinking about those last-minute tax deductions and tax strategies to reduce your 2015 taxes.

If you have any questions or need some advice on tax planning, please just give us a call.

But for now, here is a Thanksgiving song for you to share with your family and friends and to even get everyone to sing along ♭ ♪ ♫ ♬♬ ♩ ♯.

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Bruce – Your Host at The Tax Nook

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).

Maiden Voyage!

Hello and welcome to the launch of The Tax Nook. This is the official blog of my firm – Solid Tax Solutions (www.SolidTaxSolutions.com) – the premier tax services firm in New York’s Hudson Valley. This blog has been in the idea and planning stages for a long time, continually teetering on its debut. But, as they say, it’s time for the rubber to hit the road!

You will see this blog change and grow and I hope the ‘we’ (we = all of you, as well as myself) will grow with it.

Solid Tax Solutions is also on Facebook. So take a look at us over there and please ‘like’ us at Facebook.com/SolidTaxSolutions or you can always click on the Facebook icon located on the right side of this post.

I am so excited about this venture………

So let’s have some fun!

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Bruce – Your Host at The Tax Nook

Other Social Media Outlets: Facebook.com/SolidTaxSolutions (or just click on the icon on right sidebar of this page).

Website: SolidTaxSolutions.com (or just click on the icon on right sidebar of this page).