What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Laguna Niguel CA is an agreement 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 quantities arising under the Internal Revenue Code.
An offer in compromise permits you to settle your tax debt for less than the total you owe. It provides eligible taxpayers with a course toward settling their tax debt and getting a “fresh start.” The ultimate goal is a compromise that fits the very best interest of both the taxpayer and the IRS. To be thought about, generally you need to make a suitable deal based on what the IRS considers your true capability to pay. It might be a legitimate option if you can’t pay your complete tax liability, or doing so creates a financial challenge.
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 obtain a lower settlement of your tax debt, these advertisements offer an inaccurate perception that the majority of deals are proper which a lot of offers will be accepted (even unsuitable offers).
The IRS considers your special set of facts and situations. So it is important that you have representation from a knowledgeable tax professional, such as The Tax Attorney Network, so that your interests are safeguarded and that a suitable offer is made based upon your:
Capability to pay;
The OIC application needs you to describe your monetary scenario in information, so before you proceed you need to be willing to make a full and total disclosure in the above areas.
Are You Eligible For An Offer In Compromise in Laguna Niguel California
Prior to the IRS will consider your offer, you should: (1) file all tax returns you are lawfully required to submit, (2) make all required approximated tax payments for the existing year, and (3) make all required federal tax deposits for the current quarter if you are an entrepreneur with employees. In addition, you are not qualified if you are in an open insolvency case.
The OIC program is an option for taxpayers who are not able to pay their tax quantities in a lump amount or through an installment agreement and have actually tired their search for other payment arrangements. To qualify for the OIC program, taxpayers need to be able to show and show that their tax amount can not be settled under either a swelling sum or installment agreement for beginners.
All other payment options must be thought about prior to submitting an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS might legally compromise a tax liability for one of the following factors:
Doubt As To Liability: There is doubt as to whether or not the examined tax is correct.
Doubt As To Collectability: There is doubt that you could ever pay the full amount of the tax owed. In these cases, the overall amount you owe need to be higher than the amount of your assets and future income.
Promote Effective Tax Administration: There is no doubt that the assessed tax is right and no doubt that the amount owed might be collected, but you have a financial hardship or other unique circumstances which may enable 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 acceptance.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Usually, the IRS will decline a deal if you can pay your tax debt in full through an installment contract or a lump amount.
It is very important to keep in mind that penalties and interest will continue to accrue throughout the deal examination procedure.
Contact the Tax Attorney Network in Laguna Niguel CA Today at (855) 980-7563
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