Every IRS debt resolves through one of a handful of exits, and choosing among them is not taste - it is a function of three inputs. Get the inputs right and the decision mostly makes itself. Here is the framework I run on every new file.

The Three Inputs

Input one: monthly capacity - income minus allowable expenses under IRS standards, computed honestly but strategically, because this number is negotiable at the margins and every dollar matters twelve-fold or more. Input two: reachable equity - assets at quick-sale value minus loans, with the exclusions the rules grant. Input three: the statute calendar - how many months remain on the 10-year collection clock for each assessment, pulled from transcripts, because time remaining changes which exits dominate.

How the Inputs Map to Exits

Capacity zero and equity minimal: hardship status - collection stops, the clock runs, and the debt may simply expire. Capacity modest and the statute short: the partial-pay installment agreement - payments sized to reality, remainder dying with the statute, no five-year probation, no statute pause. Capacity and equity well below the debt with years left on the clock: the offer in compromise - pay the collection potential, end it permanently, accept the compliance probation. Capacity sufficient to retire the debt within the statute: the straight installment agreement, tiered by balance, structured to avoid or withdraw the lien where possible. And running crosswise through all of it: old income tax years that pass the bankruptcy timing rules, where a discharge can beat every administrative option on the board.

Penalty abatement is not an exit; it is a multiplier - run it first and every exit gets cheaper.

Why People Choose Wrong

Mischosen resolutions almost always trace to a missing input: the offer filed without checking the statute it would freeze, the payment plan signed at a number the standards never required, the hardship case that paid anyway because nobody computed capacity properly. The framework takes one conversation and one set of transcripts. Bring me both and you will leave with the exit your numbers actually support.