Why there is no one answer to "do I qualify?"
The Fresh Start Initiative was a group of collection-policy changes the IRS made in 2011 and 2012. It changed the rules for payment plans, lien notices and offers in compromise. It never created an application, an enrollment or a single eligibility test. So the question to ask is which specific option you qualify for, and the answer depends on three things: how much you owe, whether your returns are filed, and what you can afford to pay each month.
The full guide to the Fresh Start program explains the history. This page is the checklist: what each option requires today.
The baseline every option requires
Before the amount you owe matters, the IRS looks at whether you are in compliance. If you are not, nothing else is approved.
- All required tax returns are filed. The IRS says applicants for a Simple Payment Plan must be current with all filing and payment requirements, and it lists filed returns first among the conditions for an offer in compromise.
- You are keeping up with this year's tax. For employees that means enough withholding; for the self-employed it means estimated payments; for employers it means payroll deposits.
- You are not in an open bankruptcy case, if the option you want is an offer in compromise.
- You can show your finances when the option calls for it. Larger balances and hardship requests rest on a collection information statement (Form 433-F, 433-A or 433-B).
If you have years that were never filed, start there. See Fresh Start when you have unfiled returns for the order the work goes in.
Qualifying conditions, option by option
The table lists the conditions the IRS publishes for each option. Where a figure appears, it is the amount in effect in October 2026.
| Option | Who qualifies | Financial statement needed? |
|---|---|---|
| Short-term payment plan | You owe less than $100,000 in combined tax, penalties and interest and can pay within 180 days | No |
| Simple Payment Plan (individuals) | You owe $50,000 or less in assessed tax, penalties and interest, your returns are filed, and the payments clear the balance before the collection period ends | No |
| Simple Payment Plan (businesses) | $50,000 or less without trust fund taxes; $25,000 or less with trust fund taxes ($50,000 for an out-of-business sole proprietorship) | No |
| Guaranteed installment agreement | An individual who owes income tax of $10,000 or less (not counting penalties and interest), filed and paid for the previous five tax years with no installment agreement in that time, and will pay within 3 years | No |
| Payment plan above the Simple Payment Plan limit | Any balance; the payment is set from your income, expenses and assets | Generally yes |
| Offer in compromise | Returns filed, estimated payments made, no open bankruptcy, and the offer equals what the IRS could reasonably collect | Yes: Form 433-A (OIC) or 433-B (OIC) |
| Currently not collectible status | Paying anything would leave you unable to meet basic living expenses | The IRS may ask for one |
| Automatic Exemption from Penalty | The same return type filed and paid timely for the three prior years (12 quarters for quarterly filers) | No |
| Lien notice withdrawal after a direct debit plan | You owe $25,000 or less, the plan pays in full within 60 months or the collection period, and three consecutive direct debit payments have been made | No |
There is no income limit
Many pages say Fresh Start is limited to people earning under $100,000 if single or $200,000 if married. That figure is real, but it belonged to a one-time rule. In March 2012 the IRS offered a six-month grace period on the failure-to-pay penalty for unemployed taxpayers, for tax year 2011 only, and that relief carried those income caps. It ended in October 2012.
No current payment plan carries an income cap. Income matters in two other ways. Low-income taxpayers, defined as adjusted gross income at or below 250% of the federal poverty level, get reduced or waived setup fees. And for an offer in compromise or hardship status, your income and allowable expenses decide the outcome. Our page on Fresh Start myths covers the others that circulate.
There is no deadline either
The IRS has never announced an end date for Fresh Start. Payment plans, offers in compromise, lien withdrawals and penalty relief are standing procedures. An advertisement or phone call saying the program ends this month is a sales tactic. The real deadlines are the ones printed on IRS notices, which is why the letter in your hand matters more than any program name.
- A notice of intent to levy starts a 30-day window to request a hearing.
- The failure-to-pay penalty doubles to 1% a month if you have not paid within 10 days of a notice of intent to levy.
- The collection period itself generally runs 10 years from the date of assessment.
How to check where you stand
- 1.Sign in to your IRS online account and note the balance for each year, including penalties and interest.
- 2.Check that every required return shows as filed. An account transcript for each year will show it.
- 3.Compare the total with the limits in the table above.
- 4.Divide the balance by the number of months you would need. If that payment is realistic, a Simple Payment Plan is likely the answer. If it is not, read the options compared.
Where we come in
Many people who owe $50,000 or less can set up a Simple Payment Plan themselves online, and the only cost is the IRS setup fee. Where the picture is less clear, our work is the record side: reading the account and wage transcripts for every open year, preparing unfiled returns, working out the collection statute date for each assessment, preparing the Collection Information Statement with its documents, and giving you a written explanation of which options your numbers support. We give you a scope and a price in writing before anything starts.
Figures on this page were checked against the IRS and Massachusetts sources listed alongside on October 1, 2026. They change — confirm the current amount before relying on one.
General information for owner-led businesses, not advice for your specific situation. Tax and accounting rules change, and how they apply depends on facts particular to your business. Talk to us — or to another qualified professional — before acting on anything here.
