What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Lafayette IN 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, including any interest, penalties, or extra amounts emerging 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 path toward paying off 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 need to make a suitable offer based upon what the IRS considers your real capability to pay. It may be a genuine choice if you can’t pay your complete tax liability, or doing so creates a monetary difficulty.
A common 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 certainly get a lower settlement of your tax debt, these advertisements offer an inaccurate perception that many deals are appropriate which a lot of deals will be accepted (even improper offers).
The IRS considers your special set of facts and scenarios. So it is essential that you have representation from a skilled tax professional, such as The Tax Attorney Network, so that your interests are protected and that a suitable deal 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 be willing to make a full and complete disclosure in the above areas.
Eligibility For An Offer In Compromise in Lafayette Indiana
Prior to the IRS will consider your deal, you need to: (1) submit all tax returns you are lawfully needed to file, (2) make all needed approximated tax payments for the current year, and (3) make all needed federal tax deposits for the current quarter if you are an entrepreneur with employees. In addition, you are not eligible if you are in an open insolvency case.
The OIC program is a choice for taxpayers who are not able to pay their tax quantities in a lump amount or through an installment arrangement and have actually exhausted their look for other payment arrangements. To qualify for the OIC program, taxpayers must have the ability to demonstrate and prove that their tax quantity can not be settled under either a swelling sum or installation agreement for beginners.
All other payment choices should be thought about before sending an offer in compromise. The Offer in Compromise program is not for everybody.
The IRS might lawfully compromise a tax liability for one of the following reasons:
Doubt As To Liability: There is doubt as to whether the assessed tax is right.
Doubt As To Collectability: There is doubt that you might ever pay the full amount of the tax owed. In these cases, the overall amount you owe should be greater than the sum of your properties and future earnings.
Promote Effective Tax Administration: There is no doubt that the assessed tax is proper and no doubt that the quantity owed might be collected, but you have a financial hardship or other unique scenarios which might allow the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or fewer installations 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.
Typically, the IRS will not accept an offer if you can pay your tax debt in full through an installment agreement or a lump amount.
It is very important to keep in mind that penalties and interest will continue to accumulate throughout the offer assessment procedure.
Contact the Tax Attorney Network in Lafayette IN Today at (855) 980-7563
Map of Lafayette IN
Some Other Cities in Indiana That You Might Be Interested In: