Dealing With A Large Tax Bill

The IRS offers an online installment agreement for up to $50,000 owed (up from $25K).

I am curious. With such a high rate this year, and retirement very soon, what about converting appealed to you? Given the market rise over two years, it may very well have been a good move, it's the pending retirement and lack of liquidity that prompt my question.

amounts above 50k, but you have to fill out a form 433-F Collection Information Statement.

You have to make minimum payments of $25 a month, but next year you can pay the whole thing of on Jan/8, after you sell stocks and get the money.

Another possibility is to file an extension now, paying as much tax as you can with the form 4868. They will charge you penalty of 0.5% a month plus interest which is probably 3% a year as Joe says. Then July/15 you can file your return and say you need 120 days to pay. That will make the payment due Jan/15 of next year. Doing this will avoid the $52 fee to set up direct deposit, but they still might charge interest of 3% a year.

However, what if stock prices drop next year and you can't sell your stock at the price you want? It's an election year, so there's no saying what's gonna happen.

Good questions.

But an IA for amounts > $50,000 will likely require filing of Notice of Federal Tax Lien.

$25 payments will probably not be acceptable to IRS - payment amount must project full payment of all tax, penalty and interest within six years.

I referenced the new $50K easy limit as it was below the OP's amount. paultry - you are right, 6 years. This is new, up from 5, the payment would need to be over $500/mo.