An IRS Settlement through the Offer In Compromise program allows the taxpayer to settle their entire income tax debt by paying an amount that is far less than what is actually owed to the IRS.
(b) As your income tax debt goes away, you earn more money by not having to pay back taxes.
(b) There is a possibility of the IRS rejecting the request.
(c) You have to be perfectly tax compliant for five years, once your Offer in Compromise settlement request is accepted
Currently not Collectible Status
If you are unable to pay your tax debt, the IRS may consider your eligibility for Currently not Collectible Status (CNC). The IRS will cease all collection activities, which includes levies and garnishments, until the IRS notices an improvement in your financial condition.
(b) You don’t have to worry about tax levies and garnishments.
(c) The Statute of Limitations continues to run out on your income tax debt.
(b) If you do not file a return, there is a probability of cancellation of the uncollectible status
(c) Dramatic increase in income can also lead to cancellation of the status.
Making a Decision
Although, the Currently not Collectible status saves you from paying anything for a specific amount of time, the Offer In Compromise settlement is a better tax resolution avenue as you do not have to worry about the future.