Fresh Start Program FAQ: Eligibility and New Rules
Common questions about IRS Fresh Start and 2026 changes.
What Changed in 2026?
The OBBBA expanded Fresh Start limits. Debt caps increased from $50,000 to $60,000 for individuals. The program now covers more taxpayers. Installment agreement terms were extended, making payments more affordable.
What Debts Qualify?
Individual income tax debt up to $60,000 (2026). Back payroll taxes generally excluded. Penalties and interest included in the total. TFRP liability not eligible. State taxes are separate.
Filing Requirements for Fresh Start
You must be current on filing. All tax returns for the past 6 years must be submitted. If you have not filed recent returns, you must file them first. Filing compliance is non-negotiable.
Payment Terms Under Fresh Start
Installment agreement terms extended to 180 months (15 years) for smaller debts. Streamlined agreements offer faster approval. Monthly payments lower than traditional IAs. Flexible payment options available.
Lien Withdrawal Under Fresh Start
Notice of Federal Tax Lien may be withdrawn if you meet Fresh Start criteria. Withdrawal typically requires establishing a sustainable payment plan. Your credit score improves after lien withdrawal.
Who Does NOT Qualify
Those with debt over $60,000 do not qualify. Applicants with willful non-compliance (never filed) typically excluded. Those in previous failed agreements may not qualify. Businesses generally excluded (individuals only).
How to Apply for Fresh Start
File Form 9465 (Installment Agreement Request) with your return or separately. You can also call the IRS or use IRS Online Payment Agreement. Include current financial information. Processing takes 2-3 weeks.
2026 Expense Standards Under Fresh Start
The IRS updated expense allowances effective 2026. Standards increased across most categories (housing, utilities, transportation). This lowers your RCP and may help you qualify for OIC or CNC.
Frequently Asked Questions
If my debt exceeds $60,000 by $5,000, am I ineligible?
Yes. Fresh Start has a hard limit. However, you may still qualify for a regular installment agreement or OIC.
Does Fresh Start apply to state taxes?
No. Fresh Start is a federal IRS program. Each state has its own programs and does not participate in Fresh Start.
Can the IRS modify my Fresh Start payment plan?
Yes, if your financial situation changes significantly. You can request a modification to address hardship.
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