An offer in compromise is what it sounds like. After assessing your financial condition and understanding the process, you may make an offer to the IRS of an amount you can pay to satisfy your tax obligation. Beyond a payment plan, the offer may be a compromise deal whereby you pay less than you owe.
Sounds like a sweetheart deal, right? If that sounds like a great option for passing off a tax liability you don’t want to pay, it is important to consider why the IRS would agree to the transaction. A couple of reasons include:
If you think you might be interested in the program, consider using the IRS Pre-Qualifier tool to walk through the requirements for eligibility. It is important to understand you will not be able to choose a comfortable sum of money to pay the IRS and have your debt excused. Here are some granular points to understand about the process:
An offer in compromise must be crafted with care and concern for your financial future. Speak with an experienced tax attorney if you are considering an offer in compromise. Be wary of fraudsters who advertise tax or debt relief plans that guarantee the IRS will forgive your tax burden. In fact, the IRS rejects about two-thirds of offers in compromise, so the odds are not great at the outset. Despite that, if your application is compelling, the IRS may accept your offer.
Keep in mind during the COVID-19 crises, the IRS is not accepting new offers due to budget constraints and office closures.
If you have an offshore tax question, a corporate payroll tax issue, or are challenged by an overwhelming tax debt, our tax lawyers can help. At Robert J. Fedor, Esq., LLC we provide tailored options to tax problems involving private wealth or corporate assets. Contact us or call 800-579-0997 today.