Unable to Pay
If you feel you are unable to pay the entire amount, you should still file your return on time and pay as much as you can. If you file on time you will avoid a late filing penalty even if you owe additional tax. Paying as much as you can before the due date of the return will reduce your late payment penalty and interest.
If you cannot pay your full tax due, you may request a monthly payment plan. You will be charged penalty and interest and a tax lien even if your payment plan is granted but it may stop other collection activity while you are on the plan. You may find it less expensive to borrow the money to pay your taxes in full from a lending institution. See Payment Alternatives for more information.
Offers In Compromise
An offer in compromise is an offer to pay a tax liability for less than full value and may be an alternative for resolving your tax debt. The Tax Commission may consider an Offer in Compromise if:
- There is a doubt you owe the liability; or
- The liability cannot be collected in full and your offer is reasonable.
See Publication 22, Offer in Compromise for additional information.