What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in Lincoln 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 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 supplies eligible taxpayers with a path toward settling their tax debt and getting a “fresh start.” The supreme objective is a compromise that matches the best interest of both the taxpayer and the IRS. To be thought about, typically you should make a suitable offer based upon what the IRS considers your true capability to pay. It may be a genuine choice if you can’t pay your full 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 cents 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 inaccurate understanding that the majority of deals are suitable and that most deals will be accepted (even inappropriate deals).
The IRS considers your unique set of realities and situations. So it is very important that you have representation from a knowledgeable tax professional, such as The Tax Attorney Network, so that your interests are protected which an appropriate deal is made based upon your:
Ability to pay;
The OIC application requires you to describe your financial scenario in information, so before you continue you should be willing to make a complete and total disclosure in the above areas.
Are You Eligible For An Offer In Compromise in Lincoln California
Prior to the IRS will consider your offer, you must: (1) file all tax returns you are lawfully required to submit, (2) make all required approximated tax payments for the current year, and (3) make all required federal tax deposits for the existing quarter if you are a company owner with staff members. In addition, you are not eligible if you are in an open bankruptcy case.
The OIC program is a choice for taxpayers who are unable to pay their tax quantities in a lump amount or through an installment agreement and have exhausted their look for other payment plans. To qualify for the OIC program, taxpayers must have the ability to show and show that their tax quantity can not be settled under either a swelling sum or installment arrangement for beginners.
All other payment options should be considered 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 regarding whether the assessed tax is correct.
Doubt As To Collectability: There is doubt that you could ever pay the total of the tax owed. In these cases, the overall amount you owe need to be greater than the amount of your assets and future income.
Promote Effective Tax Administration: There is no doubt that the examined tax is correct and no doubt that the quantity owed could be gathered, however you have an economic difficulty or other special circumstances which might allow the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or fewer installments within 5 or fewer months from notification 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 in full through an installation arrangement or a swelling sum.
It is important to keep in mind that penalties and interest will continue to accumulate throughout the offer evaluation process.
Contact the Tax Attorney Network in Lincoln CA Today at (855) 980-7563
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