The North Carolina Department of Revenue has released new video tutorials to help residents set up a tax payment plan. The step-by-step guides explain how to request an installment payment agreement when taxpayers cannot pay their full tax bill simultaneously, offering a more transparent process for managing state tax obligations.
To qualify for a payment plan, taxpayers must file a tax return and wait until they receive a Notice of Collection. They can only request an installment payment agreement through the department’s online system. The North Carolina Department of Revenue requires all agreements to be set up with automatic withdrawals from a checking or savings account; personal checks and manual payments are not accepted.
The department offers two main types of installment agreements. A short-term payment plan allows installment payments of up to 12 months, regardless of income level. Taxpayers must show that monthly payments equal at least 7.5 percent of wages or federal adjusted gross income for longer agreements.
Taxpayers initiate the process by submitting Form RO-1033 electronically through the department’s website. Once reviewed, the department will send a confirmation email indicating whether the payment agreement is approved or rejected. If additional information is required, the notice will include instructions on what to submit next.
The new tutorials are designed to help taxpayers avoid defaulting on their installment agreements. Defaulting can lead to immediate collection actions such as wage garnishment, bank account levies, or property liens. The department hopes to reduce errors and give taxpayers more confidence when setting up a payment agreement by offering step-by-step instructions.
Even after approval, taxpayers must remain current on all future tax periods. That means filing new tax returns on time and making regular installments through their bank account. Failure to meet these obligations can result in the agreement being terminated and collection efforts resuming without further notice.
The North Carolina Department of Revenue must legally send a Notice of Collection even when a taxpayer is already enrolled in a payment plan. While this may seem confusing, confirming the amount owed and the tax period is a statutory requirement.
Taxpayers who cannot meet the standard criteria may still qualify for an installment payment agreement by submitting a collection information statement. This process often requires additional information, such as recent bank statements, to demonstrate financial hardship or unique circumstances. These exceptions are reviewed on a case-by-case basis before an agreement can be approved.
The new tutorials provide practical support for individual taxpayers and small businesses struggling with unpaid tax bills. By making the payment agreement process easier to understand, the North Carolina Department of Revenue hopes more people will use installment payments to manage balances rather than risk default.
For those who comply, an approved installment agreement prevents property seizures, wage garnishments, and new penalties during the plan period. However, refunds and lottery winnings may still be intercepted until the balance is fully paid. Taxpayers can find additional information and submit requests through the department’s website.
The North Carolina Department of Revenue has published its video tutorials and payment agreement forms online. Taxpayers can visit the Installment Payment Agreements page to review instructions, access Form RO-1033, and determine whether they qualify for a short-term payment plan or a more extended installment agreement.
Residents with questions can contact the department directly by phone or visit a local service office for support. The department's official website provides information on notices, requirements, and payment options.
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