Home
>
Tax
>
10 Thoughts on Tax Offer in Compromise

10 Thoughts on Tax Offer in Compromise

Beware of advertisements that claim to settle tax debts for "pennies on the dollar". Check the Offer In Compromise requirements to see if it is right for you.

1. If you are unable to pay a tax debt in full, if the taxpayer establishes to the satisfaction of the IRS that he either: has no means of paying the tax, or does not actually owe the tax--and an installment agreement cannot be worked out--the IRS strives to resolve the taxpayer's tax debt.

2. Under certain circumstances, you may be able to take advantage of the offer in compromise (OIC), but there are hurdles to overcome before the Internal Revenue Service accepts less than full payment. To date, taxpayers who have gone through the Offer in Compromise program to settle their tax bill have saved millions of dollars.

3. An OIC delinquent tax settlement is an agreement taxes owed for less than the full amount of taxes due. It's a complex decision and a tax attorney is needed for his extensive expertise in planning, preparing, negotiating and even appealing rejections.

4. IRS Code Sec. 7122 gives the IRS power authority to settle--compromise--federal tax liabilities. Exceptional circumstances sometimes exist that allow the IRS to consider an OIC program for the taxpayer. For example, a taxpayer must demonstrate that collection of the tax would create an economic hardship or would be unfair and inequitable.

5. Very few offers were accepted in the past, because the standards were almost impossible to meet before a tax debt was legally compromised. Recent tax legislation has given new hope to taxpayers who were previously disqualified.

6. In the past the IRS really did not want to encourage OIC's. Prior to 1992 the IRS has been reluctant to settle tax liabilities, but with mounting uncollected taxes, the IRS has decided to go easy on the growing number of cases it sees.

7. Today, the OIC program is one of the best tax resolution tools available to taxpayers. The IRS will accept an OIC when it looks unlikely that the taxes will be collected; but before that happens a good tax person must know and carefully navigate virtually every key regulation involved.

8. After all taxpayer avenues are explored and different available payment options are reviewed, the IRS makes a "business" decision: they want to collect a partial payment rather than nothing at all. The IRS is thinking, "Is there is doubt that the taxpayer will ever pay the full amount of tax owed?"

9. An OIC amount "offered" by the IRS is the amount that they feel that they can reasonably expect to collect after reviewing-- and exhausting--the taxpayer's ability to pay. The IRS weighs the doubt as to liability and doubt as to whether the tax assessed is correct.

10. Beware of advertisements they claim to settle tax debts for "pennies on the dollar", allowing taxpayers to settle their taxes for less, or often much less than you owe (or what the government claims you owe). The IRS resolves less than one percent of all balance due accounts through an OIC agreement.

Kirt Durst
Dedicated to offering news, articles, and instruction on tax. You have a definite choice in organizing your financial affairs. Visit http://www.aidtax.com for more information.

quick home cleaning Arlington Heights ..

In The News:

In response to infostealer activity increasing 500% in a year and harvesting 1.7 billion user credentials, the CyberGuy offers four ways to stay safe from infostealer malware.

Looking Glass has developed a 27-inch light-field display that allows you to see digital objects in three dimensions without headsets or glasses.

A CCTV video purportedly originating from a Chinese factory shows a robot appearing to lash out at two men in an unexplained incident.

After years of delays, travelers must now show a REAL ID, a valid passport or another federally approved ID to travel. May 7, 2025, is the deadline.

Driverless tractor-trailers are already traveling on Texas roads, raising questions about safety, reliability and the future of trucking.

Tech expert Kurt “CyberGuy" Knutsson reveals that a new AirPlay bug lets hackers take over Apple devices via Wi-Fi with no clicks needed.

This Mother's Day, gift Mom tech gadgets that simplify life, connect and show love. Tech expert Kurt “CyberGuy" Knutsson offers some ideas.

Tech expert Kurt “CyberGuy" Knutsson reports that Tesla owners are facing threats as hackers weaponize leaked data. Are you next?

Kurt “CyberGuy" Knutsson discusses how a paper pill bottle could revolutionize pharmacy packaging and cut plastic waste drastically.

The private information of about 4 million people was exposed after a major data breach involving VeriSource Services, a Texas-based HR firm.

Archer Aviation and United Airlines have teamed up to offer a more environmentally friendly way to skip New York City's traffic jams and reach your destination more quickly.

Healthcare company data breaches have leaked personal data of millions of people in recent years, and the CyberGuy offers ways to keep your information safe.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents

Police around the world are adding robots powered by artificial intelligence to their departments, and Thailand has emerged as one of the key players.

Kurt "CyberGuy" Knutsson explains five cleanup hacks — a few smart automations and tools — to declutter your technology and keep things running smoothly.

Kurt the CyberGuy breaks down whether it’s better to remove your personal information from the web yourself or use a data removal service.

Google’s scam detection features, powered by artificial intelligence, are a significant step forward in safeguarding Android users from fraud.

The FBI has issued a warning that scammers are impersonating doctors, police and banks using spoofed numbers as "smishing" texts surge nationwide.

Communities with unreliable internet service stand to gain after Amazon's Project Kuiper launched its first full batch of satellites into orbit April 28.

Tech expert Kurt “CyberGuy" Knutsson says unsubscribing from spam might actually backfire. Learn when to avoid it and stop junk effectively.

Tech expert Kurt “CyberGuy" Knutsson talks about how the first nonstop beating heart transplant, called zero ischemic time, at Taiwan hospital changes surgery.

Kurt “CyberGuy" Knutsson: FBI warns of "time-traveling" hackers.

Kurt “CyberGuy" Knutsson talks about a soft, vine-like robot called SPROUT that aids safe survivor rescues in collapsed buildings.

Health insurance giant Blue Shield of California confirmed it had been sharing private health data of 4.7 million users with Google for three years without even realizing it.

Delta and JetZero’s blended wing body aircraft marks a meaningful step toward a cleaner, quieter and more efficient future for air travel.