Did you know that one of the ways that you can solve your IRS tax problem(s) could be to get them to take less money than you owe them? Sounds weird right? No, not really when you think about it. Even as successful as the IRS is with collecting against people that owe them, it would be impossible for them to collect every dime owed from every tax payer. Some people owe more than they can pay. Some people have some to pay the IRS but cannot pay all of it. In other situations the time left for the IRS to collect against someone may not be enough for them to collect the whole balance. These are less than academic explanations, but the important thing to take away is that the IRS may accept less than the full amount that is owed to settle your IRS tax debt.
An offer in compromise will not work for everyone because not everyone will be able to meet the criteria necessary for such a resolution. Some people can pay their full debt over time through an installment agreement or payment plan. Others may be in dire straights financially and may not be able to pay anything for a while and CNC or currently not collectible status will apply to their situation. Before you assume that an offer in compromise is or isn't for you, you should have a full analysis of your individual tax situation completed by an experienced tax professional. Figuring out if you can qualify for an offer in compromise is the first step in the process. If your situation lends itself to an offer in compromise, next you will need to have your offer paperwork completed and submitted to the IRS for evaluation. It is extremely important that you complete this form heavy exercise precisely and in a way that the IRS / Internal Revenue Service can get a full understanding of your tax situation. My office assists with offers in compromise. Email me to find out if an offer in compromise is right for you. [email protected]
WORD TO THE WISE - If you do not hire someone to help you with your offer in compromise (OIC) and you submit it yourself, don't submit some ridiculous arbitrary number to the IRS for their consideration. 1. It is a waste of your time and it will not be accepted and 2. It doesn't work that way. I am sure that you have heard about people settling their 5 and 6 figure tax debts for very small amounts. I congratulate those tax payers on having their IRS debt settled for a lot less than they owe. However, please know that this does not work for everyone because it does not apply to everyone. To have your IRS tax debt settled through an OIC, the IRS has to take a deep look at your individual tax scenario. Someone with a similar debt (dollar wise) may or may not be able to have their offer accepted or rejected for the same amount as you. You may make more money, have more kids, have more time for the IRS to collect against you or a whole host of other reasons will put you in a different position that would have to be analyzed differently. Bottom line, know as much as you can about your tax debt, and your options before going this route. An offer in compromise can be a complicated and time consuming task. With the forms and all of the information you will need, an OIC should be something you don't complete on a whim. Speak to attorney Josh Madsen about your tax debt and the multiple ways that it may be able to be resolved. The first call is free and we aren't pushy. Helping people with IRS tax problems is all that we do.