During the 2020 COVID-19 / CoronaVirus pandemic, the United States IRS is offering a special plan regarding collections for those who owe IRS federal tax debt. Note that this has nothing to do with the “stimulus checks” – those are a separate matter. This is about people who owe the IRS money.
Here’s a video explanation below or keep reading on to see it on this page.
The IRS is offering a grace period on payments due to COVID-19
If you are currently on a payment plan with the IRS, paying down your tax bill, the IRS is allowing you to skip payments until July of 2020 with no penalty. This is a “grace period,” enacted specifically to help the public cope with the economic fallout from the COVID-19 pandemic. However, interest on the debt will still accrue.
To suspend IRS payments, you might need to contact your banking representative to issue a stop payment on amounts currently bound for the IRS, since phones might be down during this time. If you’re making IRS payments via mailed checks or online money transfers, you can quit making those until July of 2020.
Cases assigned revenue officers will continue
If your IRS case is already in Collections or in process of resolving a balance due, the case will go forward. If you are assigned to a Revenue Officer, the case will proceed as normal without you doing anything. And if you want the grace period to apply during the pandemic, you will have to contact the Revenue Officer to work out arrangements.
Do not assume that your case is open to the grace period if you are assigned to a Revenue Officer. Contact them and be sure you have their word, rather than just ignoring them.
Automated Collections are also paused until July 15th, 2020
If your case is being handled by an automatic collections process, those collections will also be paused until July 15th, 2020.
Pending Offers in Compromise may continue
Finally, if your case has entered an Offer in Compromise arrangement, those arrangements are not delayed. However, they might experience a slowed pace due to the current emergency situation.
Update 4/22/2020: The IRS Automated Collections System phone lines have been re-opened for resolving cases, including removing garnishments.
All of this applies only to Federal IRS situations
Individual states are free to set their own tax collection schedule and policy. Get in touch with your state office to find out whatever measures apply to your case if you owe state taxes.
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