The re-evaluation process is usually not involved in every installment agreement made with the IRS.
Tax professionals generally prefer that a client establish an installment agreement or an offer in compromise. These are essentially contracts between you and the IRS. As long you fulfill the terms of the contracts, the IRS will not bother you. You can also opt for a partial-pay installment agreement wherein you make monthly payments. In this arrangement you end up paying less than the full amount owed. These agreements are usually easier to obtain than an offer in compromise. However, they differ from an offer or a full-pay installment agreement because the IRS may choose to re-evaluate the terms of a partial-pay installment agreement every two years. This means that if the IRS assumes that you can afford to make bigger payments, you may have to renegotiate the partial-pay installment agreement. You can request re-evaluation at any time if you find that your circumstances have changed to an extent that you can no longer make the agreed upon payment.
In short, it really depends on the exact type of installment agreement you made and was accepted.
I sincerely XXXXX XXXXX information is helpful,
If you entered into a Partial Installment, which it sounds like you did, then they have the option to re-evaluate your situation every 2 years to see if more funds could be obtained from you.
You also though, can request to be evaluated again if your circumstances make it financially harmful or impossible for you to continue to make the payments in the amount first agreed upon.
If the back taxes are from a time when you filed jointl then she is on the same liablity as you. If your wife goes to work and you are increasing your income also, then I would not at this time do anything to change my status if I were you.
If the IRS should re-evaluate your situation based on the increase in your circumstances then you should be able to argue that the increase came from her working as well and the added expense of the additional car may pass with them.
The following is from the IRS' own procedures:
Maximum allowances for housing and utilities and transportation, known as the Local Standards, vary by location. In most cases, the taxpayer is allowed the amount actually spent, or the local standard, whichever is less.The ownership costs provide maximum allowances for the lease or purchase of up to two automobiles if allowed as a necessary expense. A single taxpayer is normally allowed one automobile. "
I hope this is helpful,