Tax Law

Offer in Compromise

Skillfully Presenting Your Case to the IRS

What is an Offer-in-Compromise

An offer in compromise allows you to take your tax debt and settle it for less than the amount you owe. If you are unable to pay your full tax liability or doing so creates a financial hardship, it may be a legitimate option for you. The IRS considers a unique set of facts and circumstances when considering an OiC.  These can include:

  • Ability to Pay
  • Income
  • Expenses
  • Asset Equity

The IRS will typically approve an offer in compromise when the amount offered represents the most they would be able to collect within a reasonable period of time. You should explore all payment options before submitting an offer in compromise. While The Offer in Compromise program is not for everyone, you should hire a tax professional to help you file an offer. Frost Law has tax professionals ready to help you with your OiC filing.

Do You Qualify for an Offer in Compromise?

If you have not filed all required tax returns and have not made any required estimated payments the IRS will return any newly filed offer in compromise. Any application fee included with the OiC will also be returned. Any initial payment required with the returned application will be applied to reduce your balance as well.

You cannot qualify for OiC if you are in an open bankruptcy proceeding.

No items found.
For a free consultation with our tax law team, contact us at 410-497-5947 or fill out our quick form"

What To Expect From an Offer in Compromise

During the process and while your offer is being evaluated by the IRS there are some items you should understand.

  • Your non-refundable payments and fees will be applied to the tax liability (you may designate payments to a specific tax year and tax debt);
  • A Notice of Federal Tax Lien may be filed;
  • Other collection activities are suspended;
  • The legal assessment and collection period is extended;
  • Make all required payments associated with your offer;
  • You are not required to make payments on an existing installment agreement; and
  • Your offer is automatically accepted if the IRS does not decide within two years of the IRS receipt date.

Payment Options

Based on your offer, your initial payment will vary based on the option you choose.

Lump-Sum Cash: Submit an initial payment of 20 percent of the total offer amount with your application. If your offer is accepted, you will receive written confirmation. Any remaining balance due on the offer is paid in five or fewer payments.

Periodic Payment: Submit your initial payment with your application. Continue to pay the remaining balance in monthly installments while the IRS considers your offer. If accepted, continue to pay monthly until it is paid in full.

You do not need to send the application fee or the initial payment if you meet the Low-Income Certification guidelines. You will also not need to make monthly installments during the evaluation of your offer.

Talented IRS Tax Attorneys | Seeing You Through to The Finish Line

Your financials are in order and your offer has been prepared and presented to the IRS. What happens next? Whether you've presented the offer in compromise to the IRS independently, or we've seen you through the entire process up until this point, we're here to help finalize the details.

Has the waiting started to get to you? If the IRS hasn't responded to your offer in compromise and you're starting to get impatient, let Frost Law intervene on your behalf. Let us utilize our strong working relationships with the IRS and make sure your offer doesn't just get shoved to the side without the attention it deserves. 

Our professionals are on standby, waiting to help. Call us today so that we can begin managing your debt and find the best possible solution for you!

Footnotes

Attorneys

Meet the Tax Law Team

No items found.