No! Generally, when your clients (or their consultants, attorneys, and/or accountants who don’t deal with the IRS Collections Division on a regular basis) first speak with the IRS, their first question is, “What will it take to make this go away?” This allows the IRS to frame the issue, and they frequently respond with “25 percent down and the rest paid within two years” or something similar. Your client may agree to those terms because they believe they have no alternative. A large down payment combined with a large monthly payment will create problems with your client’s cash flow, the agreement will terminate, and then the business will be in worse shape than before.
There is no basis for the idea that the IRS requires 25 percent down and the remainder paid within two years. In fact, it’s the exact opposite. The Internal Revenue Manual indicates, “Installment agreements must reflect taxpayers’ ability to pay on a monthly basis throughout the duration of agreements.” The amount of the monthly installment payment should not be based on the size of the liability or an arbitrary timeframe. Rather, the monthly payment should reflect an amount the business can afford, which will substantially decrease the likelihood that the agreement will terminate.