How to Set Up a Pennsylvania Tax Payment Plan

To set up a Pennsylvania tax payment plan, log in to the state’s myPATH portal at mypath.pa.gov, open the “More” tab, and choose “Request a Payment Plan” under “Payments and Returns.”¹ If you owe less than $50,000 in personal income tax and can pay it off within 12 months, you can finish the request online without submitting financial documents. Larger balances, longer terms, or a second plan on top of an existing one push you into an extended plan that requires a full financial disclosure before the Department of Revenue will approve it.²

Which Plan You Qualify For

The Department of Revenue splits personal income tax plans into two tiers, and the line between them decides how much paperwork you face.

A standard plan is available if your balance is under $50,000 and you can pay it in full within 12 months. You propose a monthly amount, and setup happens online or by phone with no supporting documents.

An extended plan is required if your balance exceeds $50,000, you need more than 12 months, or you already have a payment plan open with the department.² Extended plans require a detailed financial statement, verification documents, and mandatory automatic bank withdrawals.

These thresholds are for personal income tax. Business tax plans follow their own rules, covered further down.

Requesting the Plan Through myPATH

myPATH is the fastest path. Sign in, open the “More” tab, and select “Request a Payment Plan” under “Payments and Returns.”¹ The system walks you through the terms and, for a standard plan, lets you propose a monthly payment amount and finish the setup online.

If you cannot use myPATH, you can reach the department by email at RA-RV-CEC-DPP@pa.gov or by phone at 717-783-4294.² Have your Social Security Number or Federal Employer Identification Number, the tax periods involved, and the total balance from your most recent notice in front of you before you make contact.

Documents Required for an Extended Plan

Extended plans exist because the state wants to see that you genuinely cannot pay faster, so expect real paperwork. For personal income tax, three items go with the request.

The first is REV-488, the Statement of Financial Condition for Individuals. It asks for employment details, bank accounts, real estate, life insurance values, vehicles, and a full breakdown of monthly income against necessary living expenses like rent, groceries, utilities, and medical costs. Every line has to be filled in; the department will reject an incomplete form.³

The second is two months of bank statements and two months of pay stubs to verify what you reported on the REV-488.

The third is REV-692, the ACH Debit Authorization, which lets the department withdraw your monthly payment automatically from a checking or savings account. You will need your routing and account numbers, a voided check for a checking account, and a signer who is authorized to sign checks on the account. If a withdrawal fails because of insufficient funds or a closed account, the agreement is cancelled automatically.⁴

What the Plan Will Actually Cost

A payment plan does not freeze your balance. Interest keeps running on what you still owe, so the total you repay is more than the figure on your first notice.

The underpayment interest rate for 2025 and 2026 is 7% per year, set annually based on the rate established by the U.S. Secretary of the Treasury, and it is calculated daily on the outstanding balance.⁵⁶

Penalties are separate. For a personal income tax return filed on time but not paid in full, the department adds a 5% underpayment penalty on the unpaid balance.⁷ Those penalties are usually already built into the assessed balance you are being asked to pay, but knowing they are in there explains why the bill runs higher than the tax alone.

Rules You Have To Follow To Keep the Plan

Getting approved is not the finish line. The department imposes ongoing conditions, and missing any of them can unravel the arrangement.

Every scheduled payment has to be made on time. Because extended plans run on the REV-692 automatic withdrawal, a missed payment usually means insufficient funds, which cancels the agreement.⁴

You also have to file every future tax return on time and pay any new tax in full. Falling behind on current-year taxes while working off older debt is one of the most common ways people lose their plans.¹

Refunds and Liens While the Plan Is Active

A plan does not shield you from other collection activity. The department can still apply future state tax refunds to your balance, and the Treasury Offset Program can intercept federal refunds for state tax debts.⁸ An offset does not count as your monthly payment, so keep the regular withdrawals funded either way.

Tax liens can also be filed while the plan is in place. For business accounts, the department has said liens may be required for plans running past a certain length, and existing garnishments or bank attachments will not be lifted to make room for a new plan.⁹

What Happens If You Default

If the agreement is cancelled, the remaining balance becomes immediately collectible and the department can move to administrative wage garnishment without a court order. It can direct your employer to withhold up to 10% of your gross wages each pay period and send the money to the state. You will receive a Notice of Intent to Garnish Wages at least 30 days before the order reaches your employer, and once it does, withholding continues until the debt is paid or the department issues a termination notice.¹⁰ That is a materially worse outcome than the plan itself, which is why funding those automatic withdrawals matters.

Business Tax Payment Plans

Businesses use the same myPATH path, but the requirements are tighter.⁹ All outstanding returns must be filed before the department will consider a plan. Automatic bank withdrawals are mandatory for every business plan, not only the long ones. For long-term arrangements, the business submits REV-484 (the business version of the financial statement) along with a recent income statement and balance sheet.

One trap catches business owners off guard. Setting up a business plan through myPATH requires signing the REV-638, which waives your right to appeal the underlying tax liability to the Board of Appeals. If you think the assessed amount is wrong, dispute it first. Once you sign, you are locked into paying the full assessed amount.⁹

Businesses that hold a liquor license through the Liquor Control Board work directly with their assigned field agent rather than the standard payment plan process.

When a Compromise Makes More Sense

If your finances are severe enough that even a long plan will not clear the debt, Pennsylvania has a separate compromise program. Under 72 P.S. §9707, the Board of Appeals can consent to settle a tax liability for less than the full amount owed, including reducing penalties and interest.¹¹ A compromise is a negotiated settlement, not a payment plan, and the request goes to the Board of Appeals rather than the payment plan unit. Approval is discretionary and the department will look at your full financial picture, so be ready to document hardship in detail if you go this route.

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Pennsylvania Department of Revenue. Can I Get a Payment Plan for My Personal Income Taxes
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Department of Revenue. Personal Income Tax Payment Plans
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Pennsylvania Department of Revenue. REV-488 Statement of Financial Condition for Individuals
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Pennsylvania Department of Revenue. REV-692 ACH Debit Authorization
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Pennsylvania Department of Revenue. What Is the Current Interest Rate
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Pennsylvania Department of Revenue. REV-1611 2026 Interest Rate and Calculation Method
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Department of Revenue. Income Subject to Tax Withholding; Estimated Payments; Penalties, Interest, and Other Additions
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Department of Revenue. Make a Personal Income Tax Payment
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Pennsylvania Department of Revenue. Can I Set Up a Payment Plan for Business Taxes
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Department of Revenue. Wage Garnishment
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Department of Revenue. Request for Compromise