IRS TAX RELIEF - Offer in Compromise

The IRS Offer in Compromise program allows you to pay less than the amount you owe to Internal Revenue Service. The IRS, at its discretion, will let you pay less if they are not sure whether they will ever be able to recover the money from you or maybe there’s uncertainty regarding whether you’re accountable for your IRS tax debt. Here is what you should know regarding an Offer in Compromise.

How do I apply for an Offer In Compromise?

An IRS settlement through the Offer in Compromise program is not a "negotiation" or a "haggle", it is based on a complicated financial formula that the IRS uses. You’ll need to fill in Form 656, which is the form for an Offer in Compromise, together with Form 433-AOIC, which is a Collection Information Statement. Additionally, you will need to calculate the payment amount you are offering towards the IRS using the Form 433 AOIC, which is a Worksheet.

What are the terms and conditions of the Offer in Compromise that you are making?

1. The IRS sets forth all of the Contractual Conditions for a successful Offer in Compromise. Simply put, after signing the contract you agree to:
2. File your tax statements by the due date and pay your taxes promptly for the upcoming five yrs. You may NOT file an extension for the next five years. If you fail to file by April 15th the IRS will rescind the offer, and all interest and penalties will resume, and the suspended Statue of Limitation will then resume. The IRS will not accept any excuse as compliance is one of the terms of executing an Offer In Compromise.
3. Allow the IRS to keep any credits, payments and tax refunds applied on your tax debts before submitting your Offer in Compromise.
4. Allow the IRS to keep any tax refunds that may have been entitled to receive for the year you have filed OIC as this is one of the terms when filing for an Offer in Compromise.
5. Pay the amount offered to you before the mentioned deadline.

What can you do to avoid your Offer in Compromise being revoked?

Unless you follow all the conditions of your Offer in Compromise submission, the IRS will revoke your Offer in Compromise and reinstate the whole volume of your tax liability. In the event the IRS revokes your Offer in Compromise, they’ll reinstate the entire amount of your tax liability and add on the interest and penalty. Also, they might commence aggressive collection efforts. Should this happen they do allow time to file an Appeal before it is closed.

Is it possible for me to pay “pennies in the dollar” to settle my tax debts?

The advertising slogan, “pay pennies on the dollar,” may be misleading. For an Offer in Compromise to be successful, an individual pays less than the whole sum of taxes, fees and interest he owes to the IRS. However, it is necessary for him to prove that the amount he or she is paying is equivalent or maybe more than the reasonable collection potential determined by the IRS. In a broader sense, the reasonable collection potential will be the IRS’ best guess on the amount of money you can put together in the following twenty-four months to settle your debts.

How long does it take to get an Offer in Compromise application approved?

Our IRS Tax Relief team advises our clients that you should expect the Offer in Compromise process to be 10 to 12 months.

What is the fee for submitting my Offer in Compromise?

The IRS charges an end user fee of $186 to process an Offer in Compromise. You need to pay this fee whether you do the settlement offer yourself or work with an IRS Tax Attorney. If your Offer in Compromise is rejected or accepted the fee is non-refundable. There are exceptions for those with low income or already in Currently Non-Collectible (CNC) status, in that event the Service will waive the application fee. For those that are living below the poverty line, you can request a waiver by submitting form 656-A.

I’d prefer to prepare an Offer in Compromise myself. What do I need to do?

You can do that. You can prepare your own Offer in compromise, but should you do that, know this: your chances of success are diminished greatly. 



OUR IRS TAX RELIEF TEAM AT FLAT FEE TAX SERVICE, INC. CURRENTLY HAS A 95% OFFER IN COMPROMISE SUCCESS RATE.

PER IRS 2016 STATISTICS, THE IRS APPROVED 42% OF THE OFFER IN COMPROMISE SUBMISSIONS.

WE LIKE OUR RECORD A WHOLE LOT MORE.


Where will I submit my Offer in Compromise paperwork?

You will need to submit your IRS settlement offer application along with all the supporting documentation to the IRS Service Center.

In case you are not considered eligible for an Offer in Compromise, you should consider being placed into Currently not Collectible status or you can set up an installment agreement with the IRS to resolve your tax debts. You might need to get some advice from an IRS Tax Attorney to evaluate all the options you have for managing your tax debts.

CALL THE IRS TAX RELIEF TEAM AT FLAT FEE TAX SERVICE, INC.

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