What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in Independence MO is an arrangement 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 occurring 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 offers eligible taxpayers with a course toward settling their tax debt and getting a “fresh start.” The ultimate objective is a compromise that suits the best interest of both the taxpayer and the IRS. To be considered, typically you need to make a proper offer based upon what the IRS considers your real capability to pay. It might be a legitimate option if you can’t pay your complete tax liability, or doing so develops a monetary difficulty.
A typical misconception or perception thanks to advertisements is the impression that taxpayers can easily settle their tax liability “for pennies on the dollar” through the offer in compromise program. While you can definitely obtain a lower settlement of your tax debt, these ads supply an incorrect perception that a lot of offers are appropriate which the majority of deals will be accepted (even inappropriate deals).
The IRS considers your unique set of truths and scenarios. So it is important that you have representation from a knowledgeable tax professional, such as The Tax Attorney Network, so that your interests are protected which a proper offer is made based on your:
Ability to pay;
The OIC application needs you to explain your financial circumstance in detail, so prior to you proceed you should want to make a complete and total disclosure in the above areas.
Eligibility For An Offer In Compromise in Independence Missouri
Before the IRS will consider your offer, you need to: (1) submit all income tax return you are lawfully needed to file, (2) make all needed estimated tax payments for the existing year, and (3) make all needed federal tax deposits for the existing quarter if you are a business owner with employees. In addition, you are not eligible if you are in an open insolvency case.
The OIC program is an option for taxpayers who are not able to pay their tax amounts in a swelling sum or through an installation agreement and have exhausted their look for other payment arrangements. To qualify for the OIC program, taxpayers must have the ability to show and prove that their tax amount can not be settled under either a swelling amount or installation contract for beginners.
All other payment options must be considered prior to submitting an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS might legally jeopardize a tax liability for one of the following reasons:
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 total amount you owe should be greater than the amount of your possessions and future income.
Promote Effective Tax Administration: There is no doubt that the evaluated tax is proper and no doubt that the amount owed could be collected, however you have a financial hardship or other special situations which might allow the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or less installments 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 decline an offer if you can pay your tax debt completely through an installment arrangement or a swelling sum.
It is very important to keep in mind that penalties and interest will continue to accrue throughout the deal examination process.
Contact the Tax Attorney Network in Independence MO Today at (855) 980-7563
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