A: Owing taxes does not automatically bar naturalization, but USCIS examines whether you filed required returns, addressed the liability, and are complying with the payment agreement. Failure to file or pay taxes can affect good moral character. Bring the installment agreement, tax transcripts, and proof that all required payments are current.
Source: USCIS Policy Manual, Vol. 12, Part F, Ch. 5: https://www.uscis.gov/policy-manual/volume-12-part-f-chapter-5