John Bullis: What if I can't pay all the tax due?

Sometimes the tax due on the Form 1040 (Individual Income Tax Return) is more than can be paid by April 15 (or this year, April 17).

Don't get all upset about that. Just deal with it as a problem that has to be solved. You've handled change all your life. This is just another bother you can handle.

First, do file the return on time (April 17 this year), even with only a partial payment.

You might file for an extension (Form 4868) and file it on or before April 17. However, an extension does not give more time to pay the tax. The IRS will charge interest and a small penalty for failure to pay on time for any unpaid tax.

You usually can call the IRS and set up installment payments. That is like a promissory note and the monthly payments can usually be an amount you can pay each month. The IRS will continue to charge interest and penalty for failure to pay on time, but the amounts are usually not very much.

The installment payment agreement requires that you do all that is required, file future returns on time, always pay the monthly payment on or before the due date, change your situation to avoid being short the next year, etc. The IRS will cancel the installment payment agreement if you don't meet all the requirements.

It's been said, "If you are in a hole, the first thing to do is stop digging." If you have not been having enough income tax withheld, why not file a new W-4, W-9, etc., with the folks who pay you and have more tax withheld in the future.

The IRS really wants you to comply with the tax law, including making deposits or having tax withheld enough so the problem is not repeated the next year.

You may have seen some television advertisements for companies that will help you do an "offer in compromise." The ads indicate that if you owe a lot of tax, just hire them and you will only pay a small faction of the amount due.

While offers in compromise might be done, in most cases the IRS will not agree and will charge and collect the full amount. Some of those advertisers just charge a big up-front fee and don't get the big reduction for you after all.

If you can borrow the needed money to pay the tax, that might be best. Try borrowing from the bank, relatives, friends, cash value of life insurance, etc. Consider taking money out of the savings or investment accounts. You might even sell a few of the "toys" you no longer really want or need so you can pay the IRS in full.

Did you hear "Life is like a bicycle, you don't fall off unless you stop pedaling."

• John Bullis is a certified public accountant, personal financial specialist and certified senior adviser serving Carson City for 45 years. He is founder emeritus of Bullis and Company CPAs, LLC.