What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in La Mesa CA is an agreement between you (the taxpayer) and the IRS that settles a tax debt for less than the full amount owed. This uses to all taxes, including 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 supplies eligible taxpayers with a course toward paying off their tax debt and getting a “fresh start.” The ultimate objective is a compromise that fits the best interest of both the taxpayer and the IRS. To be considered, generally you should make a proper deal based on what the IRS considers your real ability to pay. It may be a legitimate choice if you can’t pay your full tax liability, or doing so develops a monetary hardship.
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 advertisements provide an incorrect understanding that most deals are suitable and that most deals will be accepted (even unsuitable offers).
The IRS considers your distinct set of realities and circumstances. So it is very important that you have representation from a skilled tax expert, such as The Tax Attorney Network, so that your interests are safeguarded and that a proper deal is made based on your:
Capability to pay;
The OIC application requires you to explain your financial circumstance in information, so prior to you proceed you need to be willing to make a full and complete disclosure in the above areas.
Eligibility For An Offer In Compromise in La Mesa California
Before the IRS will consider your offer, you must: (1) file all tax returns you are legally needed to file, (2) make all needed approximated tax payments for the current year, and (3) make all needed federal tax deposits for the present quarter if you are a company owner with employees. In addition, you are not eligible if you are in an open personal bankruptcy case.
The OIC program is a choice for taxpayers who are not able to pay their tax amounts in a lump amount or through an installation contract and have actually exhausted their search for other payment plans. To qualify for the OIC program, taxpayers should be able to show and show that their tax amount can not be settled under either a lump amount or installation contract for starters.
All other payment options must be considered prior to submitting an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS may legally jeopardize a tax liability for among the following factors:
Doubt As To Liability: There is doubt as to whether the examined tax is proper.
Doubt As To Collectability: There is doubt that you could ever pay the full amount of the tax owed. In these cases, the overall quantity you owe need to be greater than the amount of your possessions and future earnings.
Promote Effective Tax Administration: There is no doubt that the examined tax is proper and no doubt that the amount owed could be gathered, but you have an economic hardship or other special scenarios which might enable the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or fewer installations within 5 or fewer 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.
Typically, the IRS will not accept an offer if you can pay your tax debt completely through an installment contract or a swelling sum.
It is necessary to note that penalties and interest will continue to accrue during the deal examination process.
Contact the Tax Attorney Network in La Mesa CA Today at (855) 980-7563
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