What Is An Offer In Compromise (OIC)?
An offer in compromise (deal) in Virginia Beach VA is an agreement 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 quantities developing under the Internal Revenue Code.
An offer in compromise allows you to settle your tax debt for less than the total you owe. It offers qualified taxpayers with a course towards paying off 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 considered, generally you must make a suitable deal based on what the IRS considers your real ability to pay. It might be a genuine option if you can’t pay your full tax liability, or doing so creates a financial hardship.
A typical myth or perception thanks to ads 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 supply an incorrect understanding that the majority of deals are proper and that many offers will be accepted (even unsuitable deals).
The IRS considers your unique set of realities and situations. So it is very important that you have representation from a skilled tax professional, 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 explain your financial situation in information, so before you proceed you should be willing to make a full and total disclosure in the above areas.
Are You Eligible For An Offer In Compromise in Virginia Beach Virginia
Before the IRS will consider your deal, you must: (1) file all tax returns you are lawfully needed to submit, (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 business owner with staff members. In addition, you are not qualified if you are in an open personal bankruptcy case.
The OIC program is a choice for taxpayers who are not able to pay their tax amounts in a swelling amount or through an installment contract and have tired their look for other payment arrangements. To get approved for the OIC program, taxpayers need to have the ability to demonstrate and show that their tax quantity can not be settled under either a lump sum or installation arrangement for beginners.
All other payment alternatives must be considered 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 among the following reasons:
Doubt As To Liability: There is doubt as to whether or not the evaluated tax is right.
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 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 an economic challenge or other unique scenarios which may allow the IRS to accept less than the balance due.
Lump Sum Cash: Must be paid within 5 or less 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 receives the OIC.
Usually, the IRS will not accept an offer if you can pay your tax debt in full through an installment contract or a lump sum.
It is important to keep in mind that penalties and interest will continue to accrue during the deal assessment procedure.
Contact the Tax Attorney Network in Virginia Beach VA Today at (855) 980-7563
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