If you owe the IRS $100,000 or less, you can get an automatic 180-day extension to pay with no fee. Interest keeps accruing and you'll pay a 1% monthly failure-to-pay penalty, capping at 25%, but requesting the extension online or by phone removes you from collections as long as you acknowledge the debt.
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I have not done a payment plan or anything like I've done this 180-day extension. I think this is the most common one and this will buy you 180 days. That's half a year buying you 6 months of time. And if it's $100K or less, there's no fee for this. You basically get off the naughty list. The IRS is like, you reached out to us, you said you're going to pay us and this could be a lump sum. You can send it in chunks as you go, or you just wait until the 180s and send them the full amount.
Now, interest accrues and the I didn't pay penalty. So it's that 1% a month, that 1% a month. And by the way, so, you know, it goes up to 25% total. Once it hits that, it's over, except for interest. That half a percent every month of penalty continues to chunk, chunk, chunk away until you finally pay the damn thing off. I want to repeat what Matt just said. If you owe less than $100,000, you either call the IRS or go online and say, hey, I filed. Don't be too mad. I know I owe. I need 6 months. Can you work with me, please? And when you request that, it's like an automatic.
