Are you wondering about eligibility for a North Carolina state income tax payment plan? It is possible to set up an Installment Payment Agreement through the North Carolina Department of Revenue (DOR). However, the way North Carolina handles the notification process for payment plans is unique. North Carolina is also one of the more generous states in terms of the length of time taxpayers have to pay off debts in installments. Let’s explore your options for a North Carolina state tax payment plan.
Can You Make Payments on North Carolina State Taxes?
Yes, you can set up a state of North Carolina tax payment plan if you get approval from the state’s DOR. You are only permitted to initiate a state of North Carolina tax payment plan after you’ve received an official notice regarding owed taxes. You will then be permitted to request an Installment Payment Agreement to avoid collection action.
Can You Pay North Carolina State Taxes in Installments?
Yes, there is a tax payment plan North Carolina taxpayers can use to make payments in installments. Your specific installment period will be based on the amount that you owe in taxes. Here’s the breakdown for North Carolina Installment Payment Agreements for individual taxpayers:
- Less than $1,000: 15 months.
- $1,000 to $6,999: 30 months.
- $7,000 to $49,999: 40 months.
- $50,000 or more: 50 months.
The repayment period for all installment agreements granted to businesses is 12 months. This is the case regardless of the amount that is owed. Keep in mind that you can only formally apply for one of these installment options once you’ve received an official notice from North Carolina Department of Revenue.
What Are the Conditions of the North Carolina Tax Payment Plan?
We’ve already covered that you’ll need to receive an official letter alerting you to the fact that you owe taxes. There is another qualification that must be met if you want to enter into a North Carolina tax payment plan. You must be up to date will all tax returns. Luckily, you can easily file all outstanding returns with help from a tax professional if this obstacle is preventing you from receiving relief. Here’s a look at the rest of the terms you must agree to:
- You must have a bank account.
- You must file and pay all new taxes during the term of your agreement.
- You must agree to enroll in automatic payments.
- You must agree to provide any information that is requested by the Department of Revenue.
North Carolina only allows for installment payments to be paid by automatic electronic debits via bank accounts. That means that you must have a checking or savings account in order to enroll. Once approved, you are subject to penalties like garnishments and tax warrants if you fail to make payments or follow the terms of your plan.
Who’s Eligible for a North Carolina State Tax Payment Plan?
Any taxpayer who owes taxes is eligible. North Carolina Installment Payment Agreements are available for both businesses and individuals. Generally, no minimum or maximum tax debts are required.
What Is the Process for Arranging a Tax Payment Plan in North Carolina?
Most taxpayers can request an Installment Payment Agreement by using the form available on the North Carolina Department of Revenue’s website. However, you may be asked to submit additional information. Individuals can use the Collection Information Statement for Individuals (Form RO-1062). Businesses should use the Collection Information Statement for Businesses (Form RO-1063). It’s advisable to seek the help of a tax professional whenever you submit financial information to the North Carolina Department of Revenue.
How Can Tax Group Center Help?
Get your North Carolina state tax payment plan application completed with the help of a licensed tax professional. The team at Tax Group Center will help you review all of your options and comply fully with North Carolina’s requirements for tax payment plans. We’ll work hard to help you get the process completed quickly and smoothly while avoiding the potential for additional tax penalties. Give us a call today!