Spokane IRS Offer in Compromise

Making an offer in compromise (OIC) is not as easy as it may sound. When considering an offer, the IRS will examine a number of factors. Two of the most important are:

1. Does this offer make sense for our financial goals?
2. What is preventing the filer from repaying us in full?

In other words, the offer proposed has to be reasonable, and it can’t run astray of the agency’s current policies. It also has to be justified by the taxpayer with some sort of reasoning as to why they are unable to pay immediately and in full.

Instant Tax Solutions has experience dealing with IRS revenue officers and other personnel. While we can’t guarantee that an offer will be accepted, we do have familiarity with the types of offers that are.

We can use this knowledge, along with a full understanding of your own financials, to present you with a range of OIC options. You can then pick the one most comfortable for you, knowing that you have done your due diligence and have a high chance of success.

Further, we will help you document any hardship or inability to pay in full.

The average person can have difficulty presenting the financial and logical arguments that the average IRS employee is looking for. The IRS may have a host of follow-up questions, or they may see through reasoning that isn’t bulletproof.

In any of these scenarios, they are likely to simply reject the offer and move on. Working with us instead allows you to prepare well in advance, and we can help you appeal your offer decision in the event that it is not accepted.

In order to be considered for an OIC, you must first meet the eligibility criteria:

• You are current on filing your tax returns, and this year’s estimated payments
• You aren’t currently going through an open bankruptcy
• If you are applying past the filing due date for the current year, you have a valid extension
• If you are an employer, you have kept up with the most recent required tax deposit as well as the deposits for the last two quarters

Those who are eligible can submit an application for their offer in compromise, including all required forms in completion, as well as a $205 non-refundable application fee. In addition, they must either submit 20% of their proposed lump sum or the first installment amount of their proposed monthly installment plan.

The good news is that, even if the offer is rejected, all payments go towards your current tax obligations. The bad news is that you have just given away what is likely a significant portion of your liquidity, and you are now faced with the same collection actions — in addition to accruing penalties and interest.

Note that some applicants can request a low-income certification, which waives the fee as well as these initial payments.

While your offer is being considered, you should continue to make payments as if the proposed plan has gone into effect. Extending you a similar courtesy, the IRS will pause other collection activities until the decision is issued.

Any collection deadlines will be paused and extended. The new proposal supersedes any current installment agreement, so you can stop making payments on those. If you do not receive a timely response, the offer is considered accepted after two years.

When considering whether or not to accept an OIC agreement, the IRS weighs what is sometimes referred to as “doubt as to collectability.” What this simply means is that the applicant is able to successfully argue that they could not possibly repay the IRS any other way — or, at the very least, that paying them in full would jeopardize their ability to keep earning money and paying their upcoming taxes on time.

Factors the IRS considers include the applicant’s:

• Income
• Reasonable and necessary monthly expenses
• Asset value (including all property and accounts)
• Overall ability to pay

Offering a rare glimmer of guidance, the IRS states: “We generally approve an offer in compromise when the amount you offer represents the most we can expect to collect within a reasonable period of time.”

Put another way, if the IRS feels they could easily get more money out of you without having to spend a lot of money on agents or prosecution, then they are likely to reject an offer.

Instant Tax Solutions can help you evaluate your own finances from the IRS’ perspective. By examining your accounts and determining what you owe exactly, we can help you document your hardship and ability to pay.

We can then present convincing arguments as to why the amount you are proposing in compromise represents the best, most sensible deal for everyone involved. With our assistance, you can leave no stone unturned while preventing common mistakes that can lead an IRS offer in compromise to be rejected.

When you have had your offer in compromise rejected, you also have the option to file an appeal in most instances. Crucially, this appeal cannot present another, different offer from the one that was submitted.

Instead, the appeal states that the person who considered your offer essentially made an error or otherwise failed to apply the proper procedure. These issues must have been the primary reason the offer was rejected.

Effectively appealing, therefore, requires knowledge of the evaluation process and the standards the IRS uses to approve such proposals.

IRS revenue officers and other personnel have wide discretion to approve or reject offers, too, so the appellant cannot simply argue that a different agent would have made a different decision. There must be a specific error or failure to follow due process that must have been made.

Instant Tax Solutions has over a decade of history dealing with IRS appeals and other administrative procedures. We can help you decipher the complicated laws and guidelines that IRS personnel are supposed to follow when doing something like evaluating an OIC.

Our assistance can help you build a strong administrative law case in order to increase the chances that a rejected offer can be recovered upon a successful appeal.

In addition to helping you form an OIC proposal and submit your application, our experienced tax professionals can offer strategies that can get you ahead of upcoming tax burdens. With our assistance, you can create a plan for getting your future finances in order, breaking the cycle of unpaid tax balances and debt.

We can also fight against the IRS on your behalf to help you find any form of back tax relief available. Types of relief available may include:

• Penalty and interest abatement
• Levy removal
• Lien withdrawal, subordination, or discharge of property
• Adjusted tax assessments after revealing an error or filing an amended return
• Resolution of other tax account balances, depending on what you owe

Instant Tax Solutions wants to help you get accepted for one of the most powerful forms of tax there is. We understand that getting approved is far from easy, but with an understanding of your own finances and the IRS guidelines, we can help make it more likely.

Get started finding out how you can find relief when you (888) 886-5526 or contact us online to schedule your free case and accounts review today.