Do You Qualify for an IRS Offer in Compromise in Bonita Springs, Florida?

If you owe back or current taxes, you are unable to pay to the IRS it would be wise to work with a qualified tax attorney who can help you navigate and negotiate with them. Tax law changes frequently and with thousands of pages of tax code trying to do it yourself can be a stressful nightmare. The last thing you want to do is make a mistake that can cost you.

What is an Offer in Compromise?

Just as the name implies it’s a legal way to bargain with the IRS. An offer in compromise (OIC) is an agreement between you, the taxpayer, and the Internal Revenue Service. It contains terms agreed to by both parties to settle a tax liability for less than the original full amount owed. OIC is an IRS program created by Section 7122 of the Tax Code. Under OIC, there are two main ways it can be negotiated with the IRS: doubt as to collectability and doubt as to liability.

It is important to note that if you can pay the full amount financially you likely will not qualify for an OIC agreement. If you are experiencing a financial hardship, please talk with us. Applying for an OIC is a complex process, one we are happy to help you through.

If you qualify, the average discount on accepted OICs was 88%. That is 12 cents on the dollar.

In Doubt as to Collectability, the taxpayer is unable to pay the full tax debt. This is based on the taxpayer’s personal financial situation such as income, expenses, and assets.

In doubt as to liability, they taxpayers says they do not owe the debt.

How it works

If you submit an OIC, the IRS cannot collect tax liability through means of liens and levies during the time in which the OIC is being processed, the 30 days following the rejections of an offer or during the appeal of the OIC, due to the IRS Restructuring Act. This gives a person extra time to gather money to pay debt and stops the IRS from seizing assets.

If the OIC is accepted, payment terms are through cash (about 20 percent with submission of offer and 80 percent paid over five months of acceptance) or deferred payment (24 monthly payments that start with the submission of your offer).

If you find yourself with IRS tax problems, get them cleared fast with Naples and Fort Myers IRS Tax attorney Todd Babbitt. Contact him today for a free consultation about your tax problem and OIC. www.babbitttaxlaw.com 239-300-9492