If you have filed taxes every year it is best to do an Offer in Compromise, if you haven't you need to consult a CPA and have them file not only the tax returns but also a penalty waiver for the applicable returns once assessed based on the numerous applicable standards that would allow the waiver of penalties. I was able to get mine fully waived.
They would base repayment on your ability to repay. I was able to resolve my $20,000+ back taxes for less 3% of my total back taxes owed simply by submitting the appropriate paperwork. If you haven't filed taxes every year filing that would be required, and you must be current on any quarterly tax payments (if self-employed). It truly is one of the best programs avaliable, and is designed to help you overcome income related tax debt repayment issues without having to file for BK.
Did you get your OIC approved on the first round or with an appeal?
Credit report exclusion of a reported collection is mandated under FCRA 605(c) to become excluded from any credit report issued by a CRA no later than 7 years plus 180 days from the date of your first delinquency on the debt.
That exclusion period is totally separate from any statute of limitations on the debt or any continued obligation to the government for the debt.
No collection, other than one on a federal student loan, should appear on your credit report after exipration of the 7 year plus 180-day exclusion period, even if you are still within the statutory period for which you remain obligated for the taxes.