
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document affected by Public Law 106-554 Section 1(a)(7)[302(a)]]
[CITE: 26USC6159]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                Subtitle F--Procedure and Administration
 
                CHAPTER 62--TIME AND PLACE FOR PAYING TAX
 
           Subchapter A--Place and Due Date for Payment of Tax
 
Sec. 6159. Agreements for payment of tax liability in 
        installments
        

(a) Authorization of agreements

    The Secretary is authorized to enter into written agreements with 
any taxpayer under which such taxpayer is allowed to satisfy liability 
for payment of any tax in installment payments if the Secretary 
determines that such agreement will facilitate collection of such 
liability.

(b) Extent to which agreements remain in effect

                           (1) In general

        Except as otherwise provided in this subsection, any agreement 
    entered into by the Secretary under subsection (a) shall remain in 
    effect for the term of the agreement.

               (2) Inadequate information or jeopardy

        The Secretary may terminate any agreement entered into by the 
    Secretary under subsection (a) if--
            (A) information which the taxpayer provided to the Secretary 
        prior to the date such agreement was entered into was inaccurate 
        or incomplete, or
            (B) the Secretary believes that collection of any tax to 
        which an agreement under this section relates is in jeopardy.

            (3) Subsequent change in financial conditions

        If the Secretary makes a determination that the financial 
    condition of a taxpayer with whom the Secretary has entered into an 
    agreement under subsection (a) has significantly changed, the 
    Secretary may alter, modify, or terminate such agreement.

    (4) Failure to pay an installment or any other tax liability 
                 when due or to provide requested financial 
                                 information

        The Secretary may alter, modify, or terminate an agreement 
    entered into by the Secretary under subsection (a) in the case of 
    the failure of the taxpayer--
            (A) to pay any installment at the time such installment 
        payment is due under such agreement,
            (B) to pay any other tax liability at the time such 
        liability is due, or
            (C) to provide a financial condition update as requested by 
        the Secretary.

                       (5) Notice requirements

        The Secretary may not take any action under paragraph (2), (3), 
    or (4) unless--
            (A) a notice of such action is provided to the taxpayer not 
        later than the day 30 days before the date of such action, and
            (B) such notice includes an explanation why the Secretary 
        intends to take such action.

    The preceding sentence shall not apply in any case in which the 
    Secretary believes that collection of any tax to which an agreement 
    under this section relates is in jeopardy.

(c) Secretary required to enter into installment agreements in certain 
        cases

    In the case of a liability for tax of an individual under subtitle 
A, the Secretary shall enter into an agreement to accept the payment of 
such tax in installments if, as of the date the individual offers to 
enter into the agreement--
        (1) the aggregate amount of such liability (determined without 
    regard to interest, penalties, additions to the tax, and additional 
    amounts) does not exceed $10,000;
        (2) the taxpayer (and, if such liability relates to a joint 
    return, the taxpayer's spouse) has not, during any of the preceding 
    5 taxable years--
            (A) failed to file any return of tax imposed by subtitle A;
            (B) failed to pay any tax required to be shown on any such 
        return; or
            (C) entered into an installment agreement under this section 
        for payment of any tax imposed by subtitle A,

        (3) the Secretary determines that the taxpayer is financially 
    unable to pay such liability in full when due (and the taxpayer 
    submits such information as the Secretary may require to make such 
    determination);
        (4) the agreement requires full payment of such liability within 
    3 years; and
        (5) the taxpayer agrees to comply with the provisions of this 
    title for the period such agreement is in effect.

(d) Administrative review

    The Secretary shall establish procedures for an independent 
administrative review of terminations of installment agreements under 
this section for taxpayers who request such a review.

(e) Cross reference

            For rights to administrative review and appeal, see section 
        7122(d).

(Added Pub. L. 100-647, title VI, Sec. 6234(a), Nov. 10, 1988, 102 Stat. 
3735; amended Pub. L. 104-168, title II, Secs. 201(a), (b), 202(a), July 
30, 1996, 110 Stat. 1456, 1457; Pub. L. 105-206, title III, 
Secs. 3462(c)(2), 3467(a), July 22, 1998, 112 Stat. 766, 769; Pub. L. 
105-277, div. J, title IV, Sec. 4002(g), Oct. 21, 1998, 112 Stat. 2681-
907.)


                               Amendments

    1998--Subsec. (c). Pub. L. 105-206, Sec. 3467(a), added subsec. (c). 
Former subsec. (c) redesignated (d).
    Subsec. (d). Pub. L. 105-277 redesignated subsec. (d), relating to 
cross reference, as (e).
    Pub. L. 105-206, Sec. 3467(a), redesignated former subsec. (c), 
relating to administrative review, as (d).
    Pub. L. 105-206, Sec. 3462(c)(2), added subsec. (d), relating to 
cross reference.
    Subsec. (e). Pub. L. 105-277 redesignated subsec. (d), relating to 
cross reference, as (e).
    1996--Subsec. (b)(3). Pub. L. 104-168, Sec. 201(b), amended par. (3) 
generally. Prior to amendment, par. (3) read as follows:
    ``(A) In general.--If the Secretary makes a determination that the 
financial condition of a taxpayer with whom the Secretary has entered 
into an agreement under subsection (a) has significantly changed, the 
Secretary may alter, modify, or terminate such agreement.
    ``(B) Notice.--Action may be taken by the Secretary under 
subparagraph (A) only if--
        ``(i) notice of such determination is provided to the taxpayer 
    no later than 30 days prior to the date of such action, and
        ``(ii) such notice includes the reasons why the Secretary 
    believes a significant change in the financial condition of the 
    taxpayer has occurred.''
    Subsec. (b)(5). Pub. L. 104-168, Sec. 201(a), added par. (5).
    Subsec. (c). Pub. L. 104-168, Sec. 202(a), added subsec. (c).


                    Effective Date of 1998 Amendments

    Amendment by Pub. L. 105-277 effective as if included in the 
provision of the Internal Revenue Service Restructuring and Reform Act 
of 1998, Pub. L. 105-206, to which such amendment relates, see section 
4002(k) of Pub. L. 105-277, set out as a note under section 1 of this 
title.
    Amendment by section 3462(c)(2) of Pub. L. 105-206 applicable to 
proposed offers-in-compromise and installment agreements submitted after 
July 22, 1998, see section 3462(e)(1) of Pub. L. 105-206, set out as a 
note under section 6331 of this title.
    Pub. L. 105-206, title III, Sec. 3467(b), July 22, 1998, 112 Stat. 
770, provided that: ``The amendment made by this section [amending this 
section] shall take effect on the date of the enactment of this Act 
[July 22, 1998].''


                    Effective Date of 1996 Amendment

    Section 201(c) of Pub. L. 104-168 provided that: ``The amendments 
made by this section [amending this section] shall take effect on the 
date 6 months after the date of the enactment of this Act [July 30, 
1996].''
    Section 202(b) of Pub. L. 104-168 provided that: ``The amendment 
made by subsection (a) [amending this section] shall take effect on 
January 1, 1997.''


                             Effective Date

    Section 6234(c) of Pub. L. 100-647 provided that: ``The amendments 
made by this section [enacting this section and amending section 6601 of 
this title] shall apply to agreements entered into after the date of the 
enactment of this Act [Nov. 10, 1988].''


               Statements Regarding Installment Agreements

    Pub. L. 105-206, title III, Sec. 3506, July 22, 1998, 112 Stat. 771, 
as amended by Pub. L. 106-554, Sec. 1(a)(7) [title III, Sec. 302(a)], 
Dec. 21, 2000, 114 Stat. 2763, 2763A-632, provided that: ``The Secretary 
of the Treasury or the Secretary's delegate shall, beginning not later 
than September 1, 2001, provide each taxpayer who has an installment 
agreement in effect under section 6159 of the Internal Revenue Code of 
1986 an annual statement setting forth the initial balance at the 
beginning of the year, the payments made during the year, and the 
remaining balance as of the end of the year.''

                  Section Referred to in Other Sections

    This section is referred to in sections 6323, 6330, 6331, 6343, 
6601, 6651, 7122 of this title.
