seven Typical Queries About IRS Offers in Compromise
one. What is an Provide in Compromise?
An OIC is an IRS tax resolution plan that permits a taxpayer to settle their IRS again tax liability by having to pay significantly less than they owe. The quantity of a taxpayer’s desires to shell out will vary dependent on the taxpayer’s unique economic situation, as effectively as his or her unique liability quantity. Nevertheless, it is typically drastically significantly less than the tax debt owed. The IRS will only accept a taxpayer’s OIC if it is equal to or higher than the acceptable collection prospective, which is the IRS’s measurement of the taxpayer’s capacity to pay their financial debt. Most taxpayer’s will not qualify for this software.
two. What fees will I have to pay when I submit my OIC?
You will need to have to spend a $150.00 application fee, as properly as a examine or funds order for twenty% of the lump sump give.
three. What will occur if I submit my offer devoid of the twenty% payment?
If yousubmit your offer without the 20% payment, then the IRS will reject your supply as not processable, and will return your OIC and $150.00 software fee back again to you.
4. Is there any way to submit my give with out the application payment or twenty% payment?
Sure, the IRS will allow you to submit an give without the $150.00 application price or the twenty% payment if you meet the IRS’s reduced-revenue taxpayer needs. For far more data about who qualifies as a low earnings taxpayer, check out this web page on the IRS’ web site.
5. Will an Give in Compromise get rid of a wage garnishment or financial institution levy?
Getting an OIC accepted will not immediately remove a wage garnishment or lender levy. Even so, an accepted OIC will resolve your tax liability with the IRS so that you can request to have your garnishment or levy introduced.
6. How prolonged does it consider for the IRS to decide on an Supply in Compromise?
It can get the IRS numerousmonths to assessment your OIC. Furthermore, the moment the IRS performs an first evaluation, they may possibly have questions or demand clarification from you concerning some of the representations that had been made in the OIC. As such, there is genuinely no way to notify how extended it will take for the IRS to react to your OIC.
seven. What if my Supply in Compromise is rejected?
If your OIC is rejected, you even now have other choices to resolve your tax financial debt. You may qualify for placement into At present Not Collectible standing, which would essentially conclude all IRS collection exercise on your account except if your fiscal scenario changes. Or, you may well qualify for an Installment Arrangement that would permit you to shell out off your tax financial debt through manageable month to month payments.
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