Partial-Payment Inst Agr PPIA

Question 1

Definition of PPIA: What is a Partial Payment Installment Agreement?

Answer 1

An agreement with the IRS to pay tax liabilities over time in smaller, more manageable amounts. (IRC § 6159)

Question 2

Eligibility for PPIA: Who is eligible for a PPIA?

Answer 2

Taxpayers unable to pay their full tax liability and who can demonstrate financial hardship. (IRC § 6159; Rev. Proc. 2002-26)

Question 3

PPIA Application Process: How is a PPIA applied for?

Answer 3

Through IRS Form 9465 and possibly Form 433-F or 433-A. (Rev. Proc. 2002-26)

Question 4

PPIA Payment Terms: What are the payment terms for a PPIA?

Answer 4

Monthly payments of an agreed amount for a set period, possibly less than the total liability. (IRC § 6159; Rev. Proc. 2002-26)

Question 5

Review of PPIA: How often is a PPIA reviewed?

Answer 5

The IRS can review the agreement every two years, potentially leading to a change in payment amounts. (Rev. Proc. 2002-26)

Question 6

Termination of PPIA: What can cause the termination of a PPIA?

Answer 6

Missed payments, failure to file future tax returns or pay future tax liabilities, or a substantial change in financial circumstances. (IRC § 6159; Rev. Proc. 2002-26)

Question 7

Effects on Liens and Levies: How does a PPIA affect liens and levies?

Answer 7

Liens may remain in place, and levies may be released upon approval of the PPIA. (IRC § 6321; Rev. Proc. 2002-26)

Question 8

Interest and Penalties in PPIA: How are interest and penalties handled in a PPIA?

Answer 8

Interest and penalties continue to accrue on unpaid balances during the agreement. (IRC § 6601; IRC § 6651)

Question 9

Rights to Appeal in PPIA: What are the taxpayer’s rights to appeal regarding a PPIA?

Answer 9

Taxpayers can appeal a rejection, modification, or termination of a PPIA through the IRS Collection Appeals Program. (Rev. Proc. 2002-26)