I have a client who is paying on an installment agreement but she has no health insurance and needs to adjust her I/A for the proper tax withholdings.
This is a tax debt above $100k (in case that matters) and she is paying about $1200 a month. With health insurance (she is in her 50s), that should drop down by $800 a month at least but with her current payment and the need to keep up on her estimates she doesn’t have the excess cash flow to start payments on the health insurance. At her age I definitely think it is in everyone’s interest she get her payment reduced so she can get proper healthcare.
So the big question, how do you go about getting a modification? Do you simply call the IRS or do you need to submit a form? Any help greatly appreciated!
Jim, I would have her get the health insurance, update the 433-A and contact the IRS to explain she needs the health insurance and that you are submitting an updated 433 and request the modification. They may fight with you a bit but they should allow it, especially if you can show she has a health condition and needs the coverage.
Yes, the hope is that after obtaining the insurance we can get her into an OIC. She is just in a direct debt installment agreement and the IRS is not going to let her just stop paying. So I am hoping that we can get the payments reduced as low as possible so she can afford the payments (supposed to be up around $800 a month) and then after three months we can move forward with the offer.