What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Downey CA is an arrangement between you (the taxpayer) and the IRS that settles a tax debt for less than the total owed. This uses to all taxes, including any interest, penalties, or extra quantities developing under the Internal Revenue Code.
An offer in compromise enables you to settle your tax debt for less than the full amount you owe. It supplies qualified taxpayers with a course towards settling their tax debt and getting a “fresh start.” The ultimate goal is a compromise that suits the very best interest of both the taxpayer and the IRS. To be considered, usually you must make a proper offer based on what the IRS considers your real capability to pay. It may be a legitimate choice if you can’t pay your complete tax liability, or doing so develops a monetary hardship.
A typical myth or perception thanks to advertisements is the impression that taxpayers can quickly 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 incorrect understanding that many deals are appropriate and that a lot of offers will be accepted (even inappropriate deals).
The IRS considers your distinct set of truths and circumstances. So it is important that you have representation from an experienced tax expert, such as The Tax Attorney Network, so that your interests are secured and that a suitable deal is made based on your:
Ability to pay;
The OIC application requires you to explain your financial situation in detail, so prior to you proceed you should want to make a complete and complete disclosure in the above locations.
Are You Eligible For An Offer In Compromise in Downey California
Prior to the IRS will consider your offer, you need to: (1) submit 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 required federal tax deposits for the existing quarter if you are an entrepreneur with staff members. In addition, you are not eligible if you are in an open insolvency proceeding.
The OIC program is an option for taxpayers who are unable to pay their tax quantities in a swelling sum or through an installation arrangement and have tired their search for other payment arrangements. To get approved for the OIC program, taxpayers must have the ability to show and prove that their tax quantity can not be settled under either a lump amount or installation agreement for starters.
All other payment choices need to be considered prior to sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS may legally jeopardize a tax liability for among the following factors:
Doubt As To Liability: There is doubt regarding whether or not the assessed tax is proper.
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 income.
Promote Effective Tax Administration: There is no doubt that the examined tax is correct and no doubt that the amount owed could be gathered, however you have a financial hardship or other special scenarios which may permit the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or fewer installments within 5 or fewer months from notification of acceptance.
Short-term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Normally, the IRS will decline an offer if you can pay your tax debt in full through an installation contract or a lump sum.
It is necessary to keep in mind that penalties and interest will continue to accumulate throughout the deal assessment procedure.
Contact the Tax Attorney Network in Downey CA Today at (855) 980-7563
Map of Downey CA