Offer in Compromise

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Offer in Compromise

Offer in Compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service.  It settles a taxpayer’s tax liabilities for less than the full amount owed. In most cases, taxpayers who can fully pay the liabilities through an installment agreement or other means, generally won’t qualify for an OIC. There are three scenarios under which the IRS accepts Offer in Compromise requests:

  • Doubt as to Liability: The amount of tax assessed is incorrect and you disputing part or all of the tax debt.
  • Doubt as to Collectability: This is the most often used scenario. The person filing under this category must demonstrate that he or she will likely never be able to pay the full tax obligation due to financial hardship or some other compelling reason. IRS will consider the following set of facts and circumstances when reviewing Doubt as to collectability Offer: Ability to pay, income, expenses and asset/equity.
  • Effective Tax Administration (ETA): Requests for relief under this scenario do not dispute the amount of the tax and that you must not qualify for Doubt as to Collectability offer, which means that you have enough equity in assets to full pay the tax liability but due to special or exceptional circumstances liquidation of these assets would create an economic hardship. Elderly and disabled taxpayers who are on fixed income often use this scenario.

Traditionally, an Offer in Compromise involved tedious paperwork and processing times by the IRS are lengthy. However, in 2011, the Fresh Start program was instituted which provides additional relief and a more streamlined process under certain conditions. The ultimate goal is a compromise that suits the best interest of both the taxpayer and the IRS. To be considered, generally you must make an appropriate offer based on what the IRS considers your true ability to pay.

Offer in Compromises have a very low acceptance rate, and you may want to consider hiring a professional to help your chances of success if you feel that you may qualify. The team at Coast One is proud to have a track record in 2018 of saving clients 92% or more on their back taxes when negotiating an Offer in Compromise.  Give us a call today for a free consultation to see if you qualify.

Coast One Tax Group - Offer In Compromise

Owe $10,000 or more in Back Taxes?

We offer the following services:

  • Tax Resolution
  • Tax Preparation
  • Tax Negotiation
  • Tax Lien Withdrawal
  • Tax Audit Representation
  • And More...

If you owe $10,000 or more in back taxes to the State or IRS, the team of tax experts at Coast One Tax Group is here to help.

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