What Is An Offer In Compromise (OIC)?
An offer in compromise (offer) in St. Paul MN is an agreement in between you (the taxpayer) and the IRS that settles a tax debt for less than the full amount owed. This applies to all taxes, consisting of any interest, penalties, or additional amounts occurring 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 qualified taxpayers with a course towards settling their tax debt and getting a “fresh start.” The supreme goal is a compromise that fits the best interest of both the taxpayer and the IRS. To be considered, normally you need to make a proper deal based on what the IRS considers your real capability to pay. It might be a genuine option if you can’t pay your complete tax liability, or doing so creates a monetary challenge.
A typical myth or understanding thanks to ads is the impression that taxpayers can quickly 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 understanding that most deals are suitable which most deals will be accepted (even unsuitable deals).
The IRS considers your unique set of truths and situations. So it is important that you have representation from a skilled tax expert, such as The Tax Attorney Network, so that your interests are safeguarded and that a proper deal is made based on your:
Ability to pay;
The OIC application requires you to describe your financial circumstance in detail, so prior to you continue you should be willing to make a full and complete disclosure in the above areas.
Are You Eligible For An Offer In Compromise in St. Paul Minnesota
Prior to the IRS will consider your offer, you must: (1) submit all tax returns you are lawfully required to file, (2) make all needed estimated tax payments for the existing year, and (3) make all required federal tax deposits for the existing quarter if you are a business owner with employees. In addition, you are not eligible if you are in an open insolvency proceeding.
The OIC program is an option for taxpayers who are unable to pay their tax amounts in a swelling sum or through an installment agreement and have tired their search for other payment plans. To qualify for the OIC program, taxpayers need to be able to show and prove that their tax amount can not be settled under either a swelling amount or installation agreement for beginners.
All other payment choices must be considered prior to sending an offer in compromise. The Offer in Compromise program is not for everyone.
The IRS might lawfully compromise a tax liability for among the following factors:
Doubt As To Liability: There is doubt as to whether the assessed 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 quantity you owe need to be higher than the sum of your properties and future income.
Promote Effective Tax Administration: There is no doubt that the examined tax is appropriate and no doubt that the quantity owed might be gathered, but you have a financial 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 less installations within 5 or less 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.
Generally, the IRS will decline a deal if you can pay your tax debt in full through an installment agreement or a swelling amount.
It is essential to note that penalties and interest will continue to accumulate throughout the offer examination procedure.
Contact the Tax Attorney Network in St. Paul MN Today at (855) 980-7563
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