Offer in Compromise
Offer In Compromise
For those who truly need it, Offer in Compromise can be the best resolution for taxpayers. Those who use Offer in Compromise usually end up paying less than 20% of their original tax balance that they owed to the IRS.
In certain cases, you may be in a financial situation that makes it nearly impossible for you to pay your tax balance, even if you are on an installment plan. In this case, the IRS may accept an Offer in Compromise to lower your tax bill.
How an Offer in Compromise works:
The IRS and the taxpayer accept that there is no possible way for you to pay off your tax balance. You do not have enough income or assets that would be able to pay off your tax balance.
The taxpayer offers to pay the IRS the maximum amount that they can afford, even though the amount will fall short of the tax balance owed.
If the IRS accepts the amount you have offered to pay because it is the most reasonable amount for you, the IRS will agree to a compromise and lower your tax balance to match the amount you can pay.
Once the amount agreed upon by the taxpayer and the IRS is paid, the balance is considered to be “paid in full.”. This is true even though what you ended up paying is only a percentage of your original tax balance.
Getting Help with Offer In Compromise
The IRS’s acceptance rate on Offer in Compromise is very low due to the number of errors or missing fields on the filled out forms. In order to have a better chance of acceptance, you should contact one of our tax professionals for assistance to complete this process. Our highly trained staff will work hard and be happy to help you find a solution that works best for your tax balance.
To be eligible for an Offer in Compromise, the taxpayer must show the IRS that paying the tax or collection of the tax would create financial hardship that is unfair to the taxpayer.
Your best option for a successful negotiation of an Offer in Compromise is having a tax professional by your side. The Tax Defense Group’s expert tax consultants are highly experienced in submitting, preparing, and settling these types of cases and will be able to answer any questions you may have.