Your Right to a Fair and Just Tax System: Help When You Can't Pay in Full
The IRS explains the right to a fair and just tax system: payment plans, offers in compromise, wage levy limits, interest relief and Taxpayer Advocate help.
In IRS Tax Tip 2026-73 (Oct. 7, 2026), the IRS explains one of the 10 fundamental rights in the Taxpayer Bill of Rights: the right to a fair and just tax system. For preparers and self-employed clients who owe more than they can pay, this right points to real options. Here is a plain-language summary of what the IRS says.
What the right means
Taxpayers have the right to expect the tax system to consider the facts and circumstances that may affect their tax obligations, their ability to pay, or their ability to provide information on time. In other words, the IRS is expected to look at the person's situation, not only the number on the bill.
Where taxpayers can turn for help
- Taxpayer Advocate Service: taxpayers have the right to its help if they are in financial difficulty, or if the IRS has not resolved their tax issues properly and on time through its normal channels.
- Low Income Taxpayer Clinic: taxpayers may also get help from one of these clinics.
Options when a client can't pay the full bill
Eligible taxpayers who can't pay their tax bill in full may be able to arrange a payment plan with the IRS. A payment plan lets them pay a set amount over time, generally monthly.
Taxpayers can also submit an offer in compromise, which asks the IRS to settle the tax debt for less than the full amount. According to the IRS, this is available to taxpayers who:
- Believe they don't owe all or part of the tax debt.
- Are unable to pay all of the tax debt within the time permitted by law to collect.
- Would have a financial hardship, or it would be unjust, if they paid the full amount.
Basic living expenses are protected
The IRS keeps a list of national and local guidelines about basic costs of living and uses it when considering an offer to reduce someone's tax debt. However, the IRS won't use these guidelines if doing so would leave the taxpayer without enough money to pay basic living expenses. In those cases, the IRS will use the taxpayer's actual expenses.
A similar protection applies to collection. The IRS can't levy or seize all of someone's wages to collect unpaid tax. A portion is exempt from levy so the taxpayer can pay basic living expenses.
Interest can sometimes be reduced or abated
The IRS can abate or reduce any tax or liability. It is specifically authorized to abate interest that is excessive, was assessed erroneously or illegally, or was assessed after the legal time period for collection expired.
The IRS also has discretion to reduce or abate interest on an underpayment when an IRS employee caused an unreasonable delay or error and no significant aspect of the error is attributed to the taxpayer.
What preparers can tell clients
- Owing tax you can't pay in full does not mean you have no options. A payment plan or an offer in compromise may be possible.
- If the IRS has not resolved an issue properly and on time, or the client is in financial difficulty, the Taxpayer Advocate Service may help.
- Clients with limited income may also be able to get help from a Low Income Taxpayer Clinic.
- Basic living expenses are taken into account, both in settlement offers and in wage levies.
- If interest looks excessive, was assessed in error, or grew because of an unreasonable IRS delay or error, ask whether abatement may apply.
- Clients who want to understand all of their rights can read Publication 1, Your Rights as a Taxpayer.
This article summarizes an IRS Tax Tip and is general information, not advice for a specific case. The IRS says options depend on eligibility, so review each client's facts and check the IRS pages on payment plans, offers in compromise and the Taxpayer Advocate Service before recommending a course of action.
Informational only, based on the IRS source linked above; not tax or legal advice for a specific situation.