What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Elk Grove CA is a contract 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 additional quantities developing under the Internal Revenue Code.
An offer in compromise permits you to settle your tax debt for less than the full amount you owe. It offers eligible taxpayers with a course towards settling their tax debt and getting a “fresh start.” The supreme objective is a compromise that fits the very best interest of both the taxpayer and the IRS. To be considered, normally you must make an appropriate offer based upon what the IRS considers your true capability to pay. It may be a legitimate choice if you can’t pay your complete tax liability, or doing so creates a financial challenge.
A typical misconception or perception thanks to ads is the impression that taxpayers can easily settle their tax liability “for cents on the dollar” through the offer in compromise program. While you can definitely get a lower settlement of your tax debt, these ads provide an inaccurate understanding that the majority of deals are appropriate and that most deals will be accepted (even improper offers).
The IRS considers your special set of facts and scenarios. So it is important that you have representation from an experienced tax expert, such as The Tax Attorney Network, so that your interests are protected which an appropriate offer is made based on your:
Capability to pay;
The OIC application requires you to explain your financial scenario in information, so before you continue you should be willing to make a complete and complete disclosure in the above areas.
Eligibility For An Offer In Compromise in Elk Grove California
Before the IRS will consider your offer, you should: (1) submit all income tax return you are lawfully needed to submit, (2) make all required estimated tax payments for the present 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 qualified if you are in an open personal bankruptcy case.
The OIC program is a choice for taxpayers who are not able to pay their tax quantities in a swelling amount or through an installment contract and have tired their look 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 sum or installation agreement for beginners.
All other payment options should be thought about prior to submitting an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may legally jeopardize a tax liability for one of the following factors:
Doubt As To Liability: There is doubt regarding whether or not the evaluated tax is appropriate.
Doubt As To Collectability: There is doubt that you could ever pay the total of the tax owed. In these cases, the overall amount you owe must be higher than the amount of your assets and future income.
Promote Effective Tax Administration: There is no doubt that the evaluated tax is correct and no doubt that the amount owed could be collected, but you have a financial difficulty or other unique situations which might 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 acceptance.
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 a deal if you can pay your tax debt completely through an installment arrangement or a swelling sum.
It is important to keep in mind that penalties and interest will continue to accrue throughout the offer examination process.
Contact the Tax Attorney Network in Elk Grove CA Today at (855) 980-7563
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