You can have two IRS payment plans, but only under specific circumstances
The IRS allows you to have more than one payment plan, but they must cover different tax years or different types of debt. You cannot have two plans for the same tax year and the same type of tax (income tax, self-employment tax, etc.). If you already have a plan in place and owe taxes from a different year, you can set up a second plan. The IRS tracks these separately, so you will make two different monthly payments to two different accounts.
The most common reason people end up with two plans is that they owe back taxes from multiple years. For example, you might have a payment plan for 2022 taxes and a separate one for 2023 taxes. Each plan has its own payment amount, due date, and terms. You manage them independently — missing a payment on one does not automatically affect the other, though both remain your legal obligation.
Key Takeaways
- You can have two IRS payment plans if they cover different tax years or different types of tax debt, but not two plans for the same year and tax type.
- Each plan has its own monthly payment amount and due date, so you will owe two separate payments each month.
- The IRS will not automatically combine two plans into one, even if you request it — you have to manage them as separate accounts.
- If you fall behind on one plan, the IRS may take collection action on that plan while the other remains active.
- You can consolidate multiple years of debt into a single plan by requesting a new plan that covers all years at once.
When the IRS allows a second plan
The IRS permits a second plan when the debt is genuinely separate. This means different tax years, or different types of tax in the same year (though this is rare). If you owe $5,000 from 2021 and $3,000 from 2023, you can have one plan for each. The IRS system treats them as distinct debts with distinct payment schedules.
You do not need permission to have two plans — they straightforward exist if you set them up or if the IRS sets one up for you. However, the IRS will not automatically create a second plan. You have to request it, usually by calling the IRS at 1-800-829-1040 or by setting up a new plan through IRS.gov while your first plan is active. The representative or online system will confirm whether a second plan is possible based on your account.
What happens when you have two active plans
When two plans are active, you receive two separate notices and two separate bills. One might be due on the 15th of each month and the other on the 25th. You make two payments, each going to a different account within the IRS system. From the IRS's perspective, these are two debts, and each is tracked independently.
If you miss a payment on one plan, the IRS can take collection action on that plan — sending notices, assessing penalties and interest, or eventually pursuing wage garnishment or bank levy. The other plan remains unaffected by the missed payment, though you are still obligated to pay it. This is different from a single plan, where one missed payment affects the entire arrangement.
Interest and penalties continue to accrue on both plans. The IRS does not pause one plan while you focus on the other. Both debts are active, and both are accumulating interest at the current rate (usually around 8% per year, though this changes quarterly).
Why consolidating into one plan is often simpler
Many people with two plans eventually consolidate them into one. This means requesting a new plan that covers both tax years at once. The advantage is a single monthly payment, a single due date, and one set of terms to track. You contact the IRS and ask them to combine the debts into a new plan.
Consolidation does not erase the debt or change what you owe — it straightforward reorganizes it. Your total monthly payment might be higher or lower depending on the new plan terms and how much time you request to pay. The IRS will calculate a new payment amount based on the combined balance and your chosen repayment period.
To consolidate, call 1-800-829-1040 and explain that you have two active plans and want to combine them. Have your account numbers or tax years ready. The IRS representative can discuss whether consolidation makes sense for your situation and what the new payment would be.
How to set up a second plan if you need one
If you owe taxes from a different year and want a separate plan, you have two routes. The first is online through IRS.gov. Go to the IRS payment plan section, select "Set up a payment plan," and follow the prompts. The system will show you existing plans and allow you to create a new one if the debt is from a different tax year.
The second route is by phone. Call 1-800-829-1040 during business hours. Tell the representative you have an existing plan and owe taxes from another year. They will verify your identity, review your account, and set up a second plan if it is possible. They will also tell you the monthly payment amount and due date for the new plan.
You can also set up a plan in person at a local IRS office, though this is less common. Most people use the phone or online options because they are faster and do not require travel.
What to know about payment plan fees
Each payment plan has a setup fee. As of 2024, the fee ranges from $31 to $225 depending on how you set up the plan and your income level. If you have two plans, you paid a setup fee for each one. These fees are added to your balance, so you are paying interest on them as well.
This is one reason consolidation can save money. If you consolidate two plans into one, you pay only one setup fee instead of two. The fee is added to your new combined balance, but you avoid the duplicate cost.
Low-income taxpayers may may have access to for a reduced setup fee or a waiver. If your income is below a certain threshold (which varies by year), you can request a fee reduction when you set up or consolidate a plan.
What happens if you miss a payment on one plan
Missing a payment on one plan does not automatically cancel the other plan. However, it does trigger IRS collection action on the plan you missed. You will receive a notice, and the IRS may assess a failure-to-pay penalty (usually 0.5% of the unpaid amount per month). Interest continues to accrue on both the missed payment and the remaining balance.
If you miss a payment, contact the IRS when ready. Explain the situation and ask about your options. You may be able to catch up with a lump sum, adjust the payment amount on that plan, or consolidate both plans into a new arrangement with different terms. The sooner you act, the fewer penalties and interest charges you will accumulate.
Frequently Asked Questions
Can I have two payment plans for the same tax year?
No. The IRS will not allow two separate plans for the same tax year and the same type of tax. If you owe multiple types of tax in one year (income tax and self-employment tax, for example), you might have separate plans, but this is uncommon. Contact the IRS to discuss your specific situation.
Do both payment plans have to have the same monthly payment amount?
No. Each plan is calculated independently based on the debt amount and the repayment period you choose. One plan might be $200 per month and the other $150 per month. You negotiate the terms of each plan separately.
If I consolidate two plans into one, do I lose any benefits from the original plans?
No. Consolidation straightforward combines the debts and recalculates the payment. You do not lose any protections or rights. In fact, you may gain flexibility because you can renegotiate the repayment period and potentially lower your monthly payment.
What if one of my payment plans is a wage garnishment and the other is a monthly plan?
These are different types of collection action, not two separate payment plans. A wage garnishment is involuntary; a payment plan is voluntary. If you have a wage garnishment in place, you can still set up a voluntary payment plan for a different tax year. Contact the IRS to discuss how both arrangements will work together.
Can I pause one payment plan while I focus on paying off the other?
No. Both plans remain active and both require payment. However, you can request to modify one plan — for example, by lowering the monthly payment temporarily — while keeping the other plan as is. Call the IRS to discuss temporary hardship options.