Damiens Law Firm: Mississippi DOR Installment Payment PlansMississippi DOR Payment Plans and Solutions for Individuals and Businesses
When you do your taxes expecting a small bill or even a refund, finding out that you owe far more than you can pay is overwhelming. However, Mississippi taxpayers have options. The Department of Revenue offers installment agreements to help taxpayers get caught up without risking liens and levies. However, it’s important to be proactive when you know you’re unable to pay in full—the longer you wait to pay or set up other payment arrangements, the more likely it is you’ll be subject to more aggressive collection efforts.
Contact us today to learn more about how Damiens Law can help resolve your individual or business tax debt problems with a payment plan.
Key Takeaways
- The Mississippi Department of Revenue offers installment agreement options for individuals and businesses that can’t afford to pay their full tax balances immediately.
- Individuals must owe at least $75 to qualify.
- Taxpayers owing more than $3,000 must have an approved IRS installment agreement to qualify.
- Taxpayers must make all payments on time and avoid accruing new tax debt to keep their installment agreements in good standing.
When a Payment Plan Is the Right Choice for You
The Mississippi Department of Revenue always prefers payment in full and on time whenever possible. However, when that isn’t an option, they would still rather receive payment in full over time than not receive it at all. If you do not have the ability to pay in full but you can afford monthly payments, this may be the best option for you. You must also have:
- Filed all required tax returns for the past five years on or before the due date.
- Attached the Mississippi installment agreement form to the applicable tax return.
- Can’t have had an installment agreement within the past five years.
Payment Plans Offered by the MS Department of Revenue
The duration of your installment agreement (also known as a payment plan) depends on how much you owe and whether you’re seeking relief from individual or business taxes. If an individual taxpayer owes at least $75 but less than $3,000, they can spread their tax debt over 12 equal monthly payments.
If you owe more than $3,000 and have an installment agreement with the IRS, you can spread payments out over 60 months. In this scenario, you must attach a copy of your approved IRS installment agreement notification from the IRS to your application.
You can request an installment agreement if you have a business tax debt resulting from an audit, such as a sales tax audit, that you can’t pay in full. In general, you must be ready to pay one-third of what you owe and then pay the rest in six equal installments over the next six months.
Interest continues to accrue for the duration of your installment agreement. It adds up at a rate of 0.5% per month of the balance due.
Applying for an MS DOR Installment Agreement
If you are paying a business tax debt resulting from an audit and you want to take advantage of the payment plan that requires a one-third down payment, you can reach out to the Department of Revenue directly or your auditor to request an installment agreement.
However, the application process is a bit more structured for individuals requesting an installment agreement. There’s a special Mississippi Installment Agreement form that you’ll need to complete, which asks for your basic identifying information. You’ll also need to provide your spouse’s information if you are married.
Next, you must provide your banking and employer information, as well as more specific information regarding how much you owe and the amount you’ll pay each month. The amount you pay each month must be enough to pay the debt off by the end of the allowed time period.
If you have an installment agreement from the IRS and you’re requesting a payment plan for more than $3,000, don’t forget to attach a copy of your IRS installment agreement acceptance notification.
Completing Your Installment Agreement
Much like the IRS, the Mississippi Department of Revenue is strict about taxpayers on installment agreements. If you make late payments, your agreement may be terminated. If you accrue new tax liability and don’t pay it by the due date, your agreement may be terminated. If your agreement is terminated, the full amount is due immediately. Failing to pay may result in liens, levies, or wage garnishment.
When it’s time to make your final payment, you may need to contact the MS Department of Revenue for a final payment amount. This is because interest may have resulted in slight changes to your amount due.
Other Mississippi DOR Payment Options
Maybe you calculated your minimum monthly payment and felt your stomach drop. If that amount is too much for you to fit into your budget, you’re not alone. Tax debt can be stifling, and if you genuinely can’t pay in full—up front or over time—you may qualify for an offer in compromise.
The Mississippi Department of Revenue has offer in compromise options for individuals, self-employed individuals, and businesses. It’s fairly difficult to qualify for an offer in compromise, as the DOR would much rather collect the full amount owed if at all possible.
There may be additional eligible requirements as well, such as the tax debt not originating from criminal activity or the tax debt not including collected (but unpaid) trust fund taxes (like the Mississippi sales tax). If you’re interested in an offer in compromise, consider reaching out to a tax attorney to find out if you’re a good fit.
When You Need to Talk to a Tax Professional
When it comes to tax problems, it’s generally better to talk to a tax professional earlier rather than later. The sooner you begin exploring your options, the more time you have to evaluate them and figure out which one is best suited to your specific tax situation. If you have an outstanding tax liability with the Mississippi DOR and you aren’t sure how to resolve it, talking to a tax attorney may give you clarity and help resolve some of your anxiety.
A qualified tax attorney can help analyze your tax situation, figure out which options are and aren’t available to you, help you negotiate with the Department of Revenue, and protect your rights as you try to take control of your tax debt.
At Damiens Law, we understand that tax debt can be all-consuming. You deserve relief and peace of mind. Our team of experienced tax professionals is here to help you find a path to tax relief that gets you caught up, compliant, and ready to face the next tax year. Ready to talk? Call us at 601-957-9672 or reach out online to set up your discovery call.
Frequently Asked Questions
Can anyone apply for an installment agreement in Mississippi?
If you owe at least $75 to the Department of Revenue, you can request an installment agreement. Submit your application with your tax return.
Does interest continue to add up when I’m on an installment agreement?
Yes. The Department of Revenue adds interest at a rate of 0.5% of the balance due each month until your tax debt is paid off.
What happens if I miss a payment?
If you miss a payment, you risk having your installment agreement terminated.
What happens if my installment agreement is terminated?
If your installment agreement is terminated, the amount you owe becomes immediately due in full. If they can’t secure voluntary payment, they may try to collect via liens and levies.
Sources:
https://www.dor.ms.gov/individual/payment-options
https://www.dor.ms.gov/sites/default/files/Forms/Individual/71661218.pdf
https://www.dor.ms.gov/lawsregulations
https://www.sos.ms.gov/adminsearch/ACCode/00000157c.pdf
https://www.dor.ms.gov/contact/compliance-frequently-asked-questions
https://www.dor.ms.gov/sites/default/files/Laws%26Regs/Instructions%20for%20Individuals.pdf
https://www.dor.ms.gov/sites/default/files/Laws%26Regs/Instructions%20for%20Entities.pdf
