What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in San Francisco CA is an arrangement 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 additional quantities emerging under the Internal Revenue Code.
An offer in compromise permits you to settle your tax debt for less than the full amount 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 suits the very best interest of both the taxpayer and the IRS. To be considered, normally you must make a proper deal based upon what the IRS considers your real ability to pay. It might be a legitimate option if you can’t pay your complete tax liability, or doing so creates a financial hardship.
A typical misconception or perception thanks to advertisements 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 definitely acquire a lower settlement of your tax debt, these ads provide an incorrect understanding that a lot of deals are suitable which a lot of offers will be accepted (even improper offers).
The IRS considers your distinct set of truths and scenarios. So it is essential that you have representation from a knowledgeable tax expert, such as The Tax Attorney Network, so that your interests are safeguarded and that an appropriate deal is made based upon your:
Capability to pay;
The OIC application requires you to explain your monetary circumstance in detail, so before you proceed you need to want to make a full and complete disclosure in the above locations.
Are You Eligible For An Offer In Compromise in San Francisco California
Prior to the IRS will consider your offer, you must: (1) file all income tax return you are legally required to file, (2) make all required estimated tax payments for the current year, and (3) make all required federal tax deposits for the current quarter if you are a company owner with staff members. In addition, you are not eligible 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 amount or through an installment arrangement and have tired their look for other payment plans. To qualify for the OIC program, taxpayers must have the ability to demonstrate and show that their tax quantity can not be settled under either a lump sum or installment arrangement for starters.
All other payment choices 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 among the following factors:
Doubt As To Liability: There is doubt regarding whether the assessed 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 amount you owe need to be greater than the sum of your properties and future earnings.
Promote Effective Tax Administration: There is no doubt that the evaluated tax is correct and no doubt that the quantity owed might be gathered, but you have an economic difficulty or other special situations 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 fewer 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.
Normally, the IRS will not accept a deal if you can pay your tax debt in full through an installment contract or a swelling amount.
It is essential to keep in mind that penalties and interest will continue to accrue during the deal examination process.
Contact the Tax Attorney Network in San Francisco CA Today at (855) 980-7563
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