IRS Payment Plan for Business Payroll Taxes
Unpaid business taxes grow every month, so call now and a licensed tax pro sets up your plan today.
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Is there a fast IRS plan for payroll taxes?
The fast plan for business payroll taxes is the Simple Payment Plan (Business Trust Fund). It used to be called In-Business Trust Fund Express, and it is the payroll tax payment plan most small employers can get.
Under IRM 5.14.5, the old 24-month payoff rule is gone. The plan just has to clear the balance before the collection deadline, usually 10 years.
Payroll taxes are trust fund taxes: the income, Social Security and Medicare tax held back from your employees' pay. A licensed tax pro confirms which of your taxes count before your plan is set.
How much can a business owe and still qualify?
The IRS Simple Payment Plan limits are $25,000 for payroll taxes and $50,000 for the other two cases. Each limit counts assessed tax, penalties and interest together.
- Operating business that owes payroll (trust fund) taxes: $25,000 or less
- Out-of-business sole proprietor: $50,000 or less
- Business with no payroll taxes owed: $50,000 or less
| Business | Limit |
|---|---|
| Operating, owes payroll (trust fund) taxes | $25,000 or less |
| Out-of-business sole proprietor | $50,000 or less |
| No payroll taxes owed | $50,000 or less |
When does a business need a financial form?
Over $25,000 in payroll taxes does not qualify, but paying the balance down to $25,000 first does. Inside the simple limits, the IRS asks for no financial statement at all.
Above the limits, the IRS asks for Form 433-B, the business financial statement, and may file a tax lien. Larger balances follow the rules for plans over $50,000.
Business accounts cannot apply online, so every business plan is set up by phone. Our licensed tax pro sets the plan up with you and prepares Form 433-B if your balance needs one.
How does a business keep its IRS payment plan?
Make every new payroll deposit on time and file every return on time. Falling behind on new taxes is the fastest way to end the plan.
If a plan ends, you may have to pay a fee to reinstate it or pay any new tax in full. If a deposit slips, see what to do after a missed payment and let a tax pro move fast to save the plan.
A sole proprietor can use the individual long-term plan instead of the business plan.
Frequently asked questions
Can a business make a payment plan with the IRS?
Yes, but not online. Business plans are set up by phone, and sole proprietors and independent contractors apply as individuals. A licensed tax pro on our line can set yours up today.
Can I set up a payment plan for my 941 taxes?
Yes. Unpaid Form 941 payroll taxes qualify for the business Simple Payment Plan at $25,000 or less, if your filing is current. Over that, paying down to $25,000 first can still get you in.
Can payroll taxes be forgiven?
Rarely. The withheld share belongs to your employees, and the law adds extra penalties for not turning it over. Penalty relief may be possible, but the tax itself stays.
How does a payment plan with the IRS work for a business?
You agree to a monthly payment and stay current on every new deposit and return. Missing a new deposit can end the plan.
What to do now: get your business plan set
After a notice of intent to levy, unpaid tax costs a 1% penalty each month once 10 days pass. Call now and a licensed tax pro reviews your business balance for free and starts your plan today.