A “Sample Letter to IRS Requesting Payment Plan Business” is a letter you write to the IRS. It asks for a payment plan for your business taxes. You might need this if your business owes taxes. You may not be able to pay the full amount on time.
This article is here to help. We will share sample letters. These are templates and examples. They will make writing your own letter easy.
We’ve got you covered. Use these samples as your guide. Craft a perfect letter to the IRS. Get your business back on track.
Sample Letter To Irs Requesting Payment Plan Business
[Your Business Name]
[Your Business Address]
[City, State, Zip Code]
[Date]
Internal Revenue Service
[IRS Address]
[City, State, Zip Code]
**Subject: Request for Installment Agreement – [Your EIN]**
Dear Sir/Madam,
This letter is to formally request an installment agreement for outstanding business taxes. Our Employer Identification Number (EIN) is [Your EIN].
We owe [Amount Owed] in taxes for the [Tax Year] tax year. We understand our responsibility to pay these taxes.
Due to [briefly explain reason for financial difficulty, e.g., unexpected business downturn, large unforeseen expense], we are currently unable to pay the full amount.
We propose a monthly payment of [Proposed Monthly Payment Amount]. We believe this is a reasonable amount given our current financial situation. We have attached [Financial Statements – Profit & Loss, Balance Sheet] to show our current financial status.
We are committed to fulfilling our tax obligations and believe an installment agreement is the best way to do so.
Please contact us at [Your Phone Number] or [Your Email Address] if you require further information.
Thank you for your time and consideration.
Sincerely,
[Your Name]
[Your Title]
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How to Write Letter To IRS Requesting Payment Plan Business
Subject Line: Capturing Attention
The subject line is your initial foray into the IRS’s attention. Be forthright and unambiguous. Avoid jargon. State precisely what you need.
- Example 1: Request for Installment Agreement – [Your Business Name] – EIN [Your EIN]
- Example 2: Payment Plan Request – [Your Business Name] – Tax Year [YYYY]
Salutation: Setting the Tone
Maintain a professional demeanor. A proper salutation demonstrates respect and legitimacy. Err on the side of formality; you’re not penning a missive to a pal.
- Acceptable: Dear Internal Revenue Service,
- Better: Dear Sir or Madam,
- If known: Dear [Specific IRS Employee Name],
Introduction: Concisely Stating Your Case
The introduction must clearly state your business’s name, EIN, the tax year in question, and your intent to request an installment agreement. Be succinct; avoid prolixity.
Example:
“This letter pertains to [Your Business Name], EIN [Your EIN], regarding the unpaid tax liability for the tax year [YYYY]. We are writing to formally request an installment agreement to resolve this outstanding debt.”
Body Paragraph 1: Acknowledging the Debt and Demonstrating Responsibility
Acknowledge the debt owed and affirm your business’s commitment to rectifying the situation. This demonstrates fiscal responsibility, a characteristic the IRS appreciates.
- State the total amount owed (including penalties and interest, if known).
- Express an understanding of your obligation to pay taxes.
- Briefly explain any extenuating circumstances that precipitated the delinquency, without appearing mendacious.
Body Paragraph 2: Proposing a Payment Plan
Outline your proposed payment plan. Be realistic; propose an amount your business can consistently remit each month without undue hardship. Provide evidence of your capacity to pay, if available.
- Suggest a specific monthly payment amount.
- Specify the proposed start date for the payments.
- Mention your willingness to provide financial documentation if requested (bank statements, profit and loss statements).
Body Paragraph 3: Pleading Your Case (Optional)
If applicable, briefly elaborate on any hardships your business is currently experiencing that impede full and immediate payment. Be candid, but avoid excessive pathos.
- Explain any temporary setbacks affecting revenue.
- Mention any efforts underway to improve the business’s financial position.
- Reiterate your commitment to fulfilling your tax obligations.
Closing: Expressing Gratitude and Providing Contact Information
Express gratitude for their consideration and provide all pertinent contact information. A courteous closing can leave a lasting positive impression.
- Closing Remarks: “Thank you for considering our request. We are confident that an installment agreement will allow us to resolve this matter expeditiously.”
- Contact Information: Include the name, phone number, and email address of a designated contact person.
- Signature: Sign the letter with your official business title.
- Enclosures: If including any financial documents, explicitly state “Enclosures: [List of documents]”.
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Frequently Asked Questions: IRS Payment Plan Request (Business)
Navigating tax debt can be challenging. This FAQ section addresses common inquiries regarding requesting a payment plan from the IRS for your business.
1. What information should I include in my payment plan request letter?
Your letter should include your business name, Employer Identification Number (EIN), address, phone number, the tax year(s) for which you owe taxes, the amount owed, a proposed payment schedule, and the reason for your inability to pay in full.
2. Where should I send the payment plan request letter?
Send the letter to the IRS address corresponding to your business type and the tax form in question. This address can typically be found on the IRS website or on the tax form instructions.
3. What is the difference between an installment agreement and an Offer in Compromise (OIC)?
An installment agreement allows you to pay your tax debt over time, while an Offer in Compromise allows you to settle your tax debt for less than the full amount owed. An OIC requires a separate application process and is generally granted only in cases of significant financial hardship.
4. Will the IRS charge penalties and interest while I am on a payment plan?
Yes, penalties and interest will continue to accrue until the tax debt is paid in full, even while you are on a payment plan. However, you may be able to request a penalty abatement under certain circumstances.
5. Can the IRS reject my payment plan request?
Yes, the IRS can reject your request if you have a history of non-compliance, if you do not provide sufficient information, or if your proposed payment schedule is not feasible based on your financial situation.