Changes for Offers in Compromise and Installment Agreements

August 30, 2013

Changes for Offers in Compromise and Installment Agreements

Washington, DC (August 30, 2013) IRS has announced changes in user fees for offers in compromise and installment agreements starting January 1, 2014. The fee for a direct debit installment agreement remains $52, and low income taxpayers, as defined in 26 CFR 300.1(b)(2), would continue to pay $43 for any new installment agreement, including a direct debit installment agreement. The proposed regulations do not increase the fee for direct debit installment agreements because these agreements have a significantly higher completion rate. The proposed fees balance the need to recover costs with the goals of encouraging the use of installment agreements in general and direct debit installment agreements in particular.

While the proposed reg (REG-144990-12) goes into great detail on the newly calculated true costs of providing the various services and some backing-and-forthing with OMB, here's how the regs would change:

Proposed Amendments to the Regulations
Accordingly, 26 CFR part 300 is proposed to be amended as follows:

PART 300 – USER FEES
Paragraph 1. The authority citation for part 300 continues to read as follows:
Authority: 31 U.S.C. 9701.
Par. 2. In § 300.1, paragraphs (b) introductory text and (d) are revised to read as follows:

§ 300.1 Installment agreement fee.
* * * * *
(b) Fee. The fee for entering into an installment agreement before January 1, 2014, is $105. The fee for entering into an installment agreement on or after January 1, 2014, is $120. A reduced fee applies in the following situations: 
* * * * *
(d) Effective/applicability date. This section is applicable beginning January 1, 2014.
Par. 3. In § 300.2, paragraphs (b) and (d) are revised to read as follows:
§ 300.2 Restructuring or reinstatement of installment agreement fee.
* * * * *
(b) Fee. The fee for restructuring or reinstating an installment agreement before January 1, 2014, is $45. The fee for restructuring or reinstating an installment agreement on or after January 1, 2014, is $50.
* * * * *
(d) Effective/applicability date. This section is applicable beginning January 1, 2014.

Par. 4. In § 300.3, paragraphs (b)(1) introductory text and (d) are revised to read as follows:

§ 300.3 Offer to compromise fee.
* * * * *
(b) Fee. (1) The fee for processing an offer to compromise before January 1, 2014, is $150. The fee for processing an offer to compromise on or after January 1, 2014, is $186.

 

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