The CPP-1 form is the Illinois Department of Revenue’s Installment Payment Plan Request, and you file it when you owe Illinois tax you cannot pay in full and want to break the balance into monthly payments.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions Both individuals and businesses use it, and it covers most Illinois tax types, including individual income tax, business income tax, sales tax, withholding tax, and excise tax.
When to File and Who Qualifies
IDOR recommends sending in the CPP-1 within 10 days of receiving a bill or notice you cannot pay.2Illinois Department of Revenue. Payment Plan There is no hard deadline, but waiting invites additional penalties and enforcement action before you have an agreement in place.
Two conditions have to be true before IDOR will approve a plan. First, every required tax return must already be filed through the current date. If you are behind on returns, get them filed before you submit the CPP-1, or the request will not be processed. Second, the department has to agree that you cannot pay the balance in full. If their review of your finances shows you can, they will require full payment rather than granting a plan.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions
One boundary worth knowing: if you owe both individual income tax and another tax type, you need a separate CPP-1 for the individual income tax. Other tax types can be grouped on a single form, but combining individual income tax with sales tax or withholding on one submission will get it bounced back.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions
What to Gather Before You Start
You will need the tax periods your debt covers, a down payment amount you can send with the form, your bank routing and account numbers, and a proposed payment schedule. Payments can be weekly, biweekly, or monthly.
If your unpaid liability is more than $15,000, you also need to complete a financial disclosure: Form EG-13-I for individuals or Form EG-13-B for businesses.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions These forms document income, expenses, assets, and liabilities, and IDOR uses them to decide whether your proposed payment is realistic. For larger balances, the clearer your hardship documentation, the better your chance of terms you can actually sustain.
Filling Out the Four Steps
Step 1 is identification. Individuals enter their Social Security number, name, and contact information, with a space for a spouse’s Social Security number and name if the debt is joint. Businesses use a separate block for their federal employer identification number, Illinois account ID, and legal name.3Illinois Department of Revenue. CPP-1 Installment Payment Plan Request
Step 2 describes the debt and your proposed plan. List each tax period the debt covers (month, quarter, or year, depending on the tax type; for income tax, the tax year from the return). Enter the down payment amount you are sending with the form, which you can pay through MyTax Illinois, by phone, or by check. Write the remaining balance to be covered by installments, then propose a start date, payment amount, and frequency.
Step 3 is banking information. Enter your financial institution name, routing number, and account number. Signing the form authorizes IDOR to pull payments from that account by ACH debit at the frequency you chose. If you have a checking or savings account, ACH debit may be required as your payment method.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions The authorization stays in effect until the balance is paid off or you cancel it in writing.3Illinois Department of Revenue. CPP-1 Installment Payment Plan Request
Step 4 is the signature. Individuals sign personally. For a business, the person responsible for remitting tax payments has to sign.
How to Submit the Form
The paper CPP-1 goes to IDOR by fax at 217-785-2635 or by mail to the Installment Contract Unit, PO Box 19035, Springfield, IL 62794-9035.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions Fax gives you a transmission confirmation, which is useful if collections activity is already underway.
You can skip the paper form entirely by requesting a plan through MyTax Illinois. IDOR offers a pre-approved option that grants instant approval if you accept the terms it presents. If those terms do not work for your budget, you can submit a custom request through MyTax instead, but that version goes to collections staff for review and takes longer.2Illinois Department of Revenue. Payment Plan The pre-approved route is the fastest path to a confirmed agreement.
What IDOR Does With Your Request
The department reviews your form and the financial information you provided. Missing items, including an unsigned form, a missing Social Security number, no down payment, or a missing EG-13 on a debt over $15,000, trigger a follow-up that can add weeks to the process. If the file shows you have the ability to pay the full balance, IDOR will require you to do so.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions
Payment amount and plan length are set based on your financial condition rather than a fixed schedule.2Illinois Department of Revenue. Payment Plan A person with modest income and a $5,000 debt gets different terms than a business owing $50,000.
Interest and Penalties Keep Running
A payment plan is not a freeze on your balance. Interest and applicable penalties continue to accrue on the unpaid tax for the entire duration of the agreement.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions Illinois calculates interest using the federal underpayment rate, applied daily.4Illinois Department of Revenue. Pub-103, Penalties and Interest for Illinois Taxes
Late-payment penalties are tiered. A payment 1 to 30 days late carries a 2% penalty. After 31 days, the rate rises to 10%.4Illinois Department of Revenue. Pub-103, Penalties and Interest for Illinois Taxes The practical consequence is that a larger down payment and a shorter plan save real money. Stretching payments over years feels easier month to month, but the total paid can be significantly more than the original debt.
Staying in the Plan
Default on a CPP-1 agreement lets IDOR cancel the plan and demand the full remaining balance immediately. From there, the department can levy your bank account or garnish your wages.1Illinois Department of Revenue. CPP-1 Installment Payment Plan Request Instructions
Default is not limited to missed payments. The plan also fails if you stop filing required returns or fail to pay current taxes as they come due. IDOR expects you to stay compliant on everything going forward while you work down the old debt. Falling behind on a new quarter’s sales tax while paying off last year’s income tax can blow up the entire agreement.
If you see a payment problem coming, contact IDOR before the due date. Renegotiating terms is easier than rebuilding trust after a default, and it keeps enforcement tools off the table.