Letter 4213C, Reduced Installment Agreement User Fee Rejected, tells you the IRS denied your request to pay a reduced installment agreement user fee, or to have the fee waived. It does not necessarily mean your payment plan was rejected. The question is only what you pay to set it up.
Who Qualifies
Low-income taxpayers can qualify for a reduced fee, and in some cases a waiver or reimbursement, when their adjusted gross income is at or below 250% of the federal poverty guidelines for their household size. Taxpayers who set up a direct debit agreement may have the fee waived entirely if they meet the income test. Eligibility is usually determined from your most recent filed return.
Why Requests Get Denied
The most common reasons are income above the threshold, a request submitted late, or missing information. The letter identifies the reason. If the IRS used an outdated return and your income has dropped, a current return or Form 13844 may support a new request.
The fee is real money for low-income taxpayers, but do not let a fee dispute put your agreement at risk. Keep making payments while you sort it out.
If you received Letter 4213C, call us at (813) 229-7100.