What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Los Angeles CA is an arrangement in 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 emerging 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 provides eligible taxpayers with a course towards paying off 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 considered, normally you should make a proper deal based upon what the IRS considers your real ability to pay. It may be a genuine option if you can’t pay your complete tax liability, or doing so creates a financial challenge.
A common myth 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 certainly get a lower settlement of your tax debt, these advertisements provide an inaccurate perception that the majority of offers are suitable and that a lot of offers will be accepted (even improper deals).
The IRS considers your unique set of truths and situations. So it is important that you have representation from an experienced tax expert, such as The Tax Attorney Network, so that your interests are safeguarded which a suitable offer is made based upon your:
Capability to pay;
The OIC application needs you to describe your monetary circumstance in detail, so prior to you continue you must be willing to make a complete and total disclosure in the above locations.
Are You Eligible For An Offer In Compromise in Los Angeles California
Before the IRS will consider your offer, you need to: (1) file all income tax return you are lawfully required to submit, (2) make all required estimated tax payments for the existing year, and (3) make all needed federal tax deposits for the current quarter if you are a business owner with staff members. In addition, you are not qualified if you are in an open personal bankruptcy proceeding.
The OIC program is an option for taxpayers who are not able to pay their tax quantities in a lump sum or through an installment contract and have actually exhausted their search for other payment plans. To get approved 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 installment arrangement for starters.
All other payment options must be thought about prior to sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS may lawfully compromise a tax liability for one of the following factors:
Doubt As To Liability: There is doubt regarding whether the evaluated tax is appropriate.
Doubt As To Collectability: There is doubt that you might ever pay the full amount of the tax owed. In these cases, the overall quantity you owe need to be greater than the sum of your possessions and future income.
Promote Effective Tax Administration: There is no doubt that the assessed tax is right and no doubt that the amount owed could be gathered, but you have an economic difficulty or other unique scenarios which may enable 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 a deal if you can pay your tax debt completely through an installation contract or a lump amount.
It is necessary to keep in mind that penalties and interest will continue to accumulate during the offer examination procedure.
Contact the Tax Attorney Network in Los Angeles CA Today at (855) 980-7563
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