IRS Offer in Compromise (OIC)
I represent taxpayers in Minneapolis, Minnesota and all the 50 States in the United State before all administrative levels—examination, collection, and appeals—of the Internal Revenue Service (IRS).
Doubt as to Collectability offer – This type of offer is the most common type of OIC made to the IRS. In this case, the Taxpayer agrees that they owe the IRS, but are simply not in a financial position, to fully pay off their debt. The taxpayer makes an Offer to the IRS based upon their particular financial circumstances and provides back -up to support their proposal. Taxpayer can offer to pay in a lump Sum (Within 5 months of the date of acceptance) or Short Term Deferred(Periodic Payment)i.e. The taxpayer begin making monthly payments while the offer is pending and will pay the balance of the offer in more than 6 months but not more than 24 months.
Doubt as to Liability Offer – This is an offer where the taxpayer offers to settle the debt based upon being able to show they do not actually owe all of the underlying tax. In otherwords, When a Doubt as to Liability OIC is filed, the Taxpayer may be able to fully pay the debt but in this case, they do not believe they owe the debt or fully owe the debt. Unlike Doubt as to Collectability, where the Taxpayer must prove they are unable to fully pay, in this case, the Taxpayer must submit proof that they really don’t owe the amount being assessed. Even if the Taxpayer believes that zero is owed, since this is an Offer In Compromise, an Offer must be made, even if for a nominal amount.
There is another type of OIC called Effective Tax Administration – This is not common. In this case, the amount is owed and the Taxpayer has sufficient ability to pay the debt, but it is not in the government’s best interest to require the Taxpayer to fully pay .
If you or anyone you know owe back taxes or have unfiled tax returns. Please feel free to contact me by phone or email.
4124 Quebec Ave North, Suite 307 New Hope MN 55427
Phone : 612 516 5878
Fax: 651 409 2021