What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Chico CA is a contract in 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 emerging under the Internal Revenue Code.
An offer in compromise allows you to settle your tax debt for less than the total you owe. It supplies qualified taxpayers with a course toward settling their tax debt and getting a “fresh start.” The supreme goal is a compromise that suits the very best interest of both the taxpayer and the IRS. To be considered, typically you should make an appropriate deal based upon what the IRS considers your real capability to pay. It may be a legitimate alternative if you can’t pay your full tax liability, or doing so produces a financial hardship.
A typical myth or understanding thanks to advertisements 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 obtain a lower settlement of your tax debt, these ads offer an incorrect understanding that a lot of deals are proper which the majority of offers will be accepted (even inappropriate offers).
The IRS considers your special set of facts and circumstances. So it is necessary that you have representation from a skilled tax professional, such as The Tax Attorney Network, so that your interests are protected which a proper deal is made based on your:
Ability to pay;
The OIC application requires you to explain your monetary scenario in detail, so before you continue you must be willing to make a complete and total disclosure in the above areas.
Eligibility For An Offer In Compromise in Chico California
Before the IRS will consider your offer, you must: (1) file all income tax return you are legally needed to submit, (2) make all required estimated tax payments for the current year, and (3) make all needed federal tax deposits for the present quarter if you are an entrepreneur with staff members. In addition, you are not eligible if you are in an open bankruptcy case.
The OIC program is an alternative for taxpayers who are unable to pay their tax amounts in a swelling sum or through an installation agreement and have exhausted their look for other payment plans. To qualify for the OIC program, taxpayers must have the ability to demonstrate and prove that their tax quantity can not be settled under either a lump amount or installation contract for beginners.
All other payment options must be thought about before sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS might lawfully jeopardize a tax liability for among the following factors:
Doubt As To Liability: There is doubt as to whether or not the assessed 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 overall amount you owe should be greater than the amount of your properties and future earnings.
Promote Effective Tax Administration: There is no doubt that the examined tax is correct and no doubt that the quantity owed might be collected, but you have an economic difficulty or other unique circumstances which might enable the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or less installments within 5 or fewer months from notification of approval.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS receives the OIC.
Generally, the IRS will decline an offer if you can pay your tax debt completely through an installation contract or a swelling amount.
It is important to note that penalties and interest will continue to accrue throughout the offer evaluation procedure.
Contact the Tax Attorney Network in Chico CA Today at (855) 980-7563
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