As tax season approaches, many individuals and businesses may find themselves unable to pay their tax bill in full. Fortunately, the IRS offers installment agreements as a way to break up the tax debt into manageable payments. But what is the fee for setting up an installment agreement for tax year 2018?

First, it`s important to note that the fee for setting up an installment agreement depends on several factors, including the amount of tax owed and how long the individual or business needs to pay it off.

For those who owe less than $10,000, the fee to set up an installment agreement is generally $43. However, there are options to reduce or waive this fee for individuals with low income or those who set up automatic payments through a direct debit from their bank account.

For those who owe more than $10,000 or need more than 120 days to pay off their tax debt, the fee for setting up an installment agreement is $105. This fee can also be reduced or waived for those with low income or in certain hardship circumstances.

It`s worth noting that interest and penalties will still accrue on any unpaid taxes while the installment agreement is in place. However, setting up an installment agreement can help avoid more severe consequences such as wage garnishments or bank levies.

To apply for an installment agreement, individuals and businesses can use the IRS Online Payment Agreement tool or submit Form 9465, Installment Agreement Request, by mail or in person.

In summary, the fee for setting up an installment agreement for tax year 2018 depends on the amount of tax owed and how long the individual or business needs to pay it off. For those who owe less than $10,000, the fee is generally $43 and can be reduced or waived for those with low income or automatic payments. For those who owe more than $10,000 or need more than 120 days to pay off their tax debt, the fee is $105 and can also be reduced or waived in certain circumstances.