What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Inglewood CA is an agreement between you (the taxpayer) and the IRS that settles a tax debt for less than the full amount owed. This applies to all taxes, including any interest, penalties, or additional quantities arising under the Internal Revenue Code.
An offer in compromise enables you to settle your tax debt for less than the full amount you owe. It supplies eligible taxpayers with a path towards paying off their tax debt and getting a “fresh start.” The supreme objective is a compromise that fits the best interest of both the taxpayer and the IRS. To be considered, typically you must make a proper deal based on what the IRS considers your true ability to pay. It might be a genuine choice if you can’t pay your complete tax liability, or doing so creates a financial difficulty.
A common misconception or understanding thanks to ads 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 inaccurate perception that most deals are suitable which most offers will be accepted (even unsuitable offers).
The IRS considers your unique set of realities and situations. So it is necessary that you have representation from an experienced tax expert, such as The Tax Attorney Network, so that your interests are secured and that a proper deal is made based on your:
Capability to pay;
The OIC application requires you to explain your monetary scenario in detail, so before you proceed you should want to make a full and complete disclosure in the above locations.
Eligibility For An Offer In Compromise in Inglewood California
Before the IRS will consider your deal, you must: (1) file all income tax return you are legally needed to file, (2) make all needed estimated tax payments for the present 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 remain in an open insolvency case.
The OIC program is an alternative for taxpayers who are unable to pay their tax quantities in a lump sum or through an installment contract and have actually exhausted their look for other payment arrangements. To get approved for the OIC program, taxpayers must be able to show and prove that their tax amount can not be settled under either a swelling sum or installment contract for starters.
All other payment options need to be considered prior to sending 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 or not the examined tax is proper.
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 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 correct and no doubt that the quantity owed could be gathered, but you have a financial hardship or other unique situations which may permit 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 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 not accept an offer if you can pay your tax debt completely through an installation agreement or a swelling amount.
It is essential to keep in mind that penalties and interest will continue to accrue throughout the deal evaluation procedure.
Contact the Tax Attorney Network in Inglewood CA Today at (855) 980-7563
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