What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in Lynwood CA is an arrangement in between you (the taxpayer) and the IRS that settles a tax debt for less than the total owed. This uses to all taxes, including any interest, penalties, or extra amounts emerging under the Internal Revenue Code.
An offer in compromise allows you to settle your tax debt for less than the total you owe. It provides eligible taxpayers with a path towards settling their tax debt and getting a “fresh start.” The supreme objective is a compromise that suits the best interest of both the taxpayer and the IRS. To be considered, usually you should make a proper deal based on what the IRS considers your real ability to pay. It might be a genuine alternative if you can’t pay your complete tax liability, or doing so develops a monetary difficulty.
A typical misconception or perception thanks to ads is the impression that taxpayers can quickly settle their tax liability “for pennies on the dollar” through the offer in compromise program. While you can certainly acquire a lower settlement of your tax debt, these ads provide an inaccurate understanding that many deals are suitable and that a lot of deals will be accepted (even inappropriate offers).
The IRS considers your distinct set of truths and scenarios. So it is important that you have representation from an experienced tax professional, 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 describe your financial situation in information, so before you continue you need to be willing to make a complete and complete disclosure in the above areas.
Eligibility For An Offer In Compromise in Lynwood California
Before the IRS will consider your deal, you should: (1) file all income tax return you are lawfully required to submit, (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 qualified if you remain in an open bankruptcy 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 installation contract and have tired their search for other payment plans. To qualify for the OIC program, taxpayers need to be able to demonstrate and prove that their tax quantity can not be settled under either a lump amount or installment arrangement for starters.
All other payment options should be considered prior to sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS may legally compromise a tax liability for among the following reasons:
Doubt As To Liability: There is doubt as to whether or not the evaluated tax is correct.
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 must be higher 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 gathered, but you have an economic difficulty or other special scenarios which may 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 approval.
Short Term Periodic Payment: Must be paid within 24 months (2 years) from the date the IRS gets the OIC.
Usually, the IRS will not accept a deal if you can pay your tax debt in full through an installment agreement or a lump sum.
It is very important to keep in mind that penalties and interest will continue to accrue throughout the offer examination process.
Contact the Tax Attorney Network in Lynwood CA Today at (855) 980-7563
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