Certain taxpayers who enter into installment agreements on timely filed returns will have the failure to pay penalty reduced from a half to a quarter percent per month for any month in which an installment agreement is in effect as long as the following conditions are met:

  1. the installment agreement was entered into on or after January 1, 2000;
  2. the balances are due from an individual;
  3. the tax return(s) was timely filed, including extensions; and
  4. no CP 504, LT 11, or Letter 1058 was sent, increasing the failure to pay penalty from one-half (0.5) to one (1) percent.