What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in Alpharetta GA is a contract in between you (the taxpayer) and the IRS that settles a tax debt for less than the total owed. This uses to all taxes, consisting of any interest, penalties, or extra amounts developing under the Internal Revenue Code.
An offer in compromise permits you to settle your tax debt for less than the total you owe. It provides eligible taxpayers with a path toward settling their tax debt and getting a “fresh start.” The supreme objective is a compromise that matches the very best interest of both the taxpayer and the IRS. To be considered, usually you must make an appropriate deal based on what the IRS considers your true ability to pay. It may be a legitimate alternative if you can’t pay your complete tax liability, or doing so develops a monetary difficulty.
A typical misconception or understanding thanks to ads is the impression that taxpayers can easily settle their tax liability “for pennies on the dollar” through the offer in compromise program. While you can definitely get a lower settlement of your tax debt, these ads offer an inaccurate understanding that the majority of offers are suitable and that a lot of deals will be accepted (even inappropriate offers).
The IRS considers your distinct set of realities and situations. So it is very important that you have representation from an experienced tax professional, such as The Tax Attorney Network, so that your interests are secured and that an appropriate offer is made based on your:
Capability to pay;
The OIC application needs you to describe your financial situation in information, so before you proceed you should want to make a full and complete disclosure in the above locations.
Eligibility For An Offer In Compromise in Alpharetta Georgia
Before the IRS will consider your deal, you should: (1) submit all income tax return you are lawfully needed to submit, (2) make all required estimated tax payments for the current year, and (3) make all required federal tax deposits for the present quarter if you are a company owner with workers. In addition, you are not eligible if you remain in an open insolvency case.
The OIC program is an option for taxpayers who are not able to pay their tax quantities in a lump amount or through an installment agreement and have tired their look for other payment plans. To qualify for the OIC program, taxpayers should be able to show and prove that their tax quantity can not be settled under either a swelling amount or installation agreement for beginners.
All other payment alternatives should be thought about prior to sending an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may lawfully jeopardize a tax liability for among the following factors:
Doubt As To Liability: There is doubt as to whether or not the examined tax is correct.
Doubt As To Collectability: There is doubt that you could ever pay the total of the tax owed. In these cases, the overall quantity you owe should be higher than the amount of your assets and future income.
Promote Effective Tax Administration: There is no doubt that the assessed tax is appropriate and no doubt that the quantity owed could be gathered, but you have a financial hardship or other special situations which might enable the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or fewer installations within 5 or less months from notification of acceptance.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS receives the OIC.
Normally, the IRS will not accept a deal if you can pay your tax debt completely through an installment agreement or a lump sum.
It is necessary to note that penalties and interest will continue to accrue during the deal assessment procedure.