What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in Bowie MD is an agreement between you (the taxpayer) and the IRS that settles a tax debt for less than the total owed. This applies to all taxes, consisting of any interest, penalties, or additional quantities arising under the Internal Revenue Code.
An offer in compromise enables you to settle your tax debt for less than the total you owe. It supplies 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, generally you need to make an appropriate offer based upon what the IRS considers your true ability to pay. It might be a genuine choice if you can’t pay your full tax liability, or doing so develops a monetary challenge.
A typical myth or perception 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 certainly acquire a lower settlement of your tax debt, these advertisements offer an inaccurate understanding that many offers are suitable which a lot of offers will be accepted (even inappropriate offers).
The IRS considers your unique set of facts 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 protected and that a suitable deal is made based on your:
Capability to pay;
The OIC application needs you to describe your financial situation in information, so prior to you proceed you need to want to make a full and complete disclosure in the above locations.
Are You Eligible For An Offer In Compromise in Bowie Maryland
Before the IRS will consider your deal, you must: (1) submit all tax returns you are legally required to file, (2) make all required approximated tax payments for the current year, and (3) make all needed federal tax deposits for the present quarter if you are an entrepreneur with workers. In addition, you are not qualified if you remain in an open personal bankruptcy proceeding.
The OIC program is an option for taxpayers who are not able to pay their tax amounts in a lump sum or through an installation contract and have actually exhausted their search for other payment arrangements. To receive the OIC program, taxpayers should have the ability to show and prove that their tax amount can not be settled under either a lump amount or installation contract for starters.
All other payment alternatives should be considered before sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS may legally jeopardize a tax liability for one of the following factors:
Doubt As To Liability: There is doubt regarding whether the examined tax is appropriate.
Doubt As To Collectability: There is doubt that you might ever pay the full amount of the tax owed. In these cases, the total amount you owe must be higher than the amount of your properties and future earnings.
Promote Effective Tax Administration: There is no doubt that the assessed tax is appropriate and no doubt that the amount owed could be gathered, however you have a financial hardship or other special situations which may permit the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or less installations within 5 or fewer months from notice of approval.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Typically, the IRS will decline an offer if you can pay your tax debt in full through an installation arrangement or a lump amount.
It is very important to keep in mind that penalties and interest will continue to accumulate throughout the deal examination procedure.
Contact the Tax Attorney Network in Bowie MD Today at (855) 980-7563
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