What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Greenville NC is a contract 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 amounts arising under the Internal Revenue Code.
An offer in compromise enables you to settle your tax debt for less than the total you owe. It offers qualified taxpayers with a course toward paying off their tax debt and getting a “fresh start.” The supreme goal is a compromise that fits the best interest of both the taxpayer and the IRS. To be thought about, generally you should make an appropriate offer based on what the IRS considers your true ability to pay. It may be a legitimate option if you can’t pay your complete tax liability, or doing so creates a monetary hardship.
A common misconception 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 advertisements provide an inaccurate perception that the majority of offers are suitable and that most deals will be accepted (even unsuitable offers).
The IRS considers your special set of realities and circumstances. So it is necessary that you have representation from a skilled tax expert, such as The Tax Attorney Network, so that your interests are protected which a suitable offer is made based on your:
Ability to pay;
The OIC application needs you to describe your financial scenario in detail, so before you continue you should be willing to make a full and complete disclosure in the above areas.
Are You Eligible For An Offer In Compromise in Greenville North Carolina
Prior to the IRS will consider your deal, you need to: (1) submit all income tax return you are legally required to file, (2) make all needed estimated tax payments for the current year, and (3) make all needed federal tax deposits for the present quarter if you are a business owner with workers. 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 quantities in a swelling sum or through an installment arrangement and have exhausted their look for other payment arrangements. To get approved for the OIC program, taxpayers need to be able to show and prove that their tax amount can not be settled under either a swelling amount or installation arrangement for beginners.
All other payment alternatives must be considered before sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS may lawfully jeopardize a tax liability for among the following reasons:
Doubt As To Liability: There is doubt as to 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 total quantity you owe must be higher than the sum of your properties and future income.
Promote Effective Tax Administration: There is no doubt that the assessed tax is right and no doubt that the quantity owed could be gathered, however you have an economic difficulty or other special scenarios which may enable 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 notice of acceptance.
Short-term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS receives the OIC.
Normally, the IRS will decline a deal if you can pay your tax debt completely through an installation arrangement or a lump amount.
It is important to keep in mind that penalties and interest will continue to accrue throughout the deal assessment process.