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Pope Mobile posted:I've got a question about paying what I owe off: The IRS will let you set up a payment plan that pays it off over as long as five years without a whole lot of work on your part with that small of a debt. You really just need to send in a Form 9465: http://www.irs.gov/pub/irs-pdf/f9465.pdf Zeta Taskforce posted:You can do a payment agreement with the IRS, but it is so stacked against you, you would do better getting a loan somewhere. You would do better getting a cash advance on a credit card if it came to that. I completely disagree. The IRS charges interest rates that fluctuate based on the Federal Reserve short-term rate, so right now they are pretty drat low (4%). As long as you file your return on time, you can avoid the late filing penalty which is the big one (5% for every month that it's late). So, let's say you can pay off your $2,200 bill over one year. You're going to pay 0.5% late payment penalty per month, so 6% penalty for the entire year ($132). And you're going to pay 4% interest on both the principal and penalty, compounded daily. If you can pay it in a year, you'll pay a total of around $2,427. That's an effective interest rate, even taking the penalty into account, of just over 10.3%. I seriously doubt a credit card can beat that, especially on a cash advance. Just don't get a late filing penalty, that makes it much more expensive! 
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Mar 10, 2011 17:04
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True, fair enough. I'm used to that $105 being inconsequential, but with this small of a debt it makes a difference.
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Mar 10, 2011 17:20
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