What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Escondido CA is a contract in between you (the taxpayer) and the IRS that settles a tax debt for less than the full amount owed. This uses to all taxes, consisting of any interest, penalties, or additional quantities developing under the Internal Revenue Code.
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It provides eligible taxpayers with a course toward paying off their tax debt and getting a “fresh start.” The ultimate goal is a compromise that fits the very best interest of both the taxpayer and the IRS. To be considered, generally you should make a suitable deal based on what the IRS considers your real ability to pay. It might be a genuine choice if you can’t pay your complete tax liability, or doing so produces a financial difficulty.
A typical myth 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 obtain a lower settlement of your tax debt, these ads offer an inaccurate perception that the majority of offers are suitable and that the majority of offers will be accepted (even inappropriate deals).
The IRS considers your unique set of truths and situations. So it is essential that you have representation from a skilled tax professional, such as The Tax Attorney Network, so that your interests are secured and that a suitable offer is made based upon your:
Capability to pay;
The OIC application needs you to describe your financial situation in detail, so before you proceed you must be willing to make a complete and total disclosure in the above areas.
Eligibility For An Offer In Compromise in Escondido California
Prior to the IRS will consider your deal, you should: (1) file all income tax return you are lawfully required to file, (2) make all required estimated tax payments for the existing year, and (3) make all required federal tax deposits for the present quarter if you are a company owner with workers. In addition, you are not eligible if you are in an open personal bankruptcy proceeding.
The OIC program is an option for taxpayers who are not able to pay their tax quantities in a lump amount or through an installation agreement and have exhausted their look for other payment arrangements. To qualify for the OIC program, taxpayers should have the ability to demonstrate and show that their tax amount can not be settled under either a swelling sum or installment arrangement for beginners.
All other payment choices should be considered prior to submitting an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may legally compromise a tax liability for among the following reasons:
Doubt As To Liability: There is doubt as to whether the assessed tax is right.
Doubt As To Collectability: There is doubt that you might ever pay the total of the tax owed. In these cases, the overall quantity you owe need to be higher than the sum of your properties and future income.
Promote Effective Tax Administration: There is no doubt that the evaluated tax is appropriate and no doubt that the amount owed might be gathered, but you have an economic challenge or other unique circumstances which may enable 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.
Usually, the IRS will not accept an offer if you can pay your tax debt completely through an installation arrangement or a swelling amount.
It is important to keep in mind that penalties and interest will continue to accrue during the offer assessment process.
Contact the Tax Attorney Network in Escondido CA Today at (855) 980-7563
Map of Escondido CA