What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Fountain Valley CA is an arrangement 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 extra quantities arising under the Internal Revenue Code.
An offer in compromise permits 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 ultimate goal is a compromise that fits the best interest of both the taxpayer and the IRS. To be considered, normally you should make an appropriate offer based on what the IRS considers your true capability to pay. It might be a legitimate alternative if you can’t pay your full tax liability, or doing so develops a monetary challenge.
A common 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 provide an incorrect perception that the majority of deals are suitable and that most offers will be accepted (even inappropriate offers).
The IRS considers your unique set of facts and scenarios. So it is essential 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 offer is made based upon your:
Ability to pay;
The OIC application requires you to describe your financial scenario in information, so before you proceed you must want to make a full and total disclosure in the above locations.
Eligibility For An Offer In Compromise in Fountain Valley California
Prior to the IRS will consider your deal, you need to: (1) submit all tax returns you are legally required to file, (2) make all needed estimated tax payments for the current year, and (3) make all required federal tax deposits for the current quarter if you are an entrepreneur with employees. In addition, you are not qualified if you are in an open insolvency case.
The OIC program is an alternative for taxpayers who are not able to pay their tax amounts in a lump amount or through an installation agreement and have tired their look for other payment arrangements. To qualify for the OIC program, taxpayers need to have the ability to demonstrate and prove that their tax quantity can not be settled under either a swelling sum or installation arrangement for starters.
All other payment choices should be considered before submitting an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may legally compromise a tax liability for one of the following factors:
Doubt As To Liability: There is doubt regarding whether the assessed tax is correct.
Doubt As To Collectability: There is doubt that you might ever pay the full amount of the tax owed. In these cases, the overall quantity you owe must be higher than the sum of your properties and future earnings.
Promote Effective Tax Administration: There is no doubt that the examined tax is right and no doubt that the amount owed might be collected, but you have a financial challenge or other special situations which may allow the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or less installations within 5 or less months from notification of approval.
Short-term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Usually, the IRS will decline an offer if you can pay your tax debt completely through an installment agreement or a lump sum.
It is essential to note that penalties and interest will continue to accumulate throughout the deal evaluation procedure.
Contact the Tax Attorney Network in Fountain Valley CA Today at (855) 980-7563
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