What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Dunwoody GA is an arrangement in between you (the taxpayer) and the IRS that settles a tax debt for less than the full amount owed. This applies to all taxes, consisting of any interest, penalties, or extra quantities emerging under the Internal Revenue Code.
An offer in compromise permits you to settle your tax debt for less than the total you owe. It offers qualified 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 thought about, generally you need to make a proper deal based upon what the IRS considers your real ability to pay. It may be a legitimate choice if you can’t pay your full tax liability, or doing so develops a financial difficulty.
A typical misconception or perception thanks to ads 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 acquire a lower settlement of your tax debt, these ads supply an incorrect perception that most offers are proper and that most deals will be accepted (even improper deals).
The IRS considers your special set of facts and scenarios. So it is 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 upon your:
Capability to pay;
The OIC application requires you to describe your financial scenario in information, so before you proceed you need to want to make a full and total disclosure in the above areas.
Eligibility For An Offer In Compromise in Dunwoody Georgia
Before the IRS will consider your offer, you need to: (1) file all income tax return you are legally required to submit, (2) make all needed estimated tax payments for the existing year, and (3) make all required federal tax deposits for the existing quarter if you are a company owner with staff members. In addition, you are not qualified if you remain in an open bankruptcy case.
The OIC program is an alternative for taxpayers who are unable to pay their tax quantities in a lump amount or through an installation arrangement and have actually tired their search for other payment arrangements. To qualify for the OIC program, taxpayers should have the ability to demonstrate and show that their tax quantity can not be settled under either a lump amount or installation contract for beginners.
All other payment options should be thought about prior to sending an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may legally jeopardize a tax liability for among the following factors:
Doubt As To Liability: There is doubt as to whether the examined 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 need to be greater than the amount of your properties and future income.
Promote Effective Tax Administration: There is no doubt that the evaluated tax is correct and no doubt that the quantity owed might be gathered, however you have a financial hardship or other special circumstances which might permit 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 notice of approval.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Normally, the IRS will not accept an offer if you can pay your tax debt completely through an installment agreement or a swelling sum.
It is essential to keep in mind that penalties and interest will continue to accrue throughout the deal examination process.