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Installment Agreement Confusion

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    Installment Agreement Confusion

    I set up an IA for a client over the phone. The Agreement called for $100 a month to be withheld from the client's pay. I thought and I conveyed to the IRS that the client got paid twice a month so the IRS and I and my client were expecting $50 to be withheld from each pay. Instead it turns out that my client is paid biweekly (26 pay periods per year) and so they have decided to withhold $46.15 from each pay and they want another contact from the IRS before they change that. Meanwhile I am not sure how upset the Service is. The person who pointed out the shortage to me noted that no adverse action such as threat of default seems to be under consideration.

    So what should I do for my client?

    #2
    Originally posted by erchess View Post
    I set up an IA for a client over the phone. The Agreement called for $100 a month to be withheld from the client's pay. I thought and I conveyed to the IRS that the client got paid twice a month so the IRS and I and my client were expecting $50 to be withheld from each pay. Instead it turns out that my client is paid biweekly (26 pay periods per year) and so they have decided to withhold $46.15 from each pay and they want another contact from the IRS before they change that. Meanwhile I am not sure how upset the Service is. The person who pointed out the shortage to me noted that no adverse action such as threat of default seems to be under consideration.

    So what should I do for my client?
    There is nothing to do. That 46.15 amount IS $100 per month.
    ChEAr$,
    Harlan Lunsford, EA n LA

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