Taxes are really important and you can’t get away without paying them. However, there are times when you get behind on your bills and are unable to pay your taxes. Instead of waiting and hoping that they don’t notice, you should try to work with the Internal Revenue Service (IRS) to try and qualify for an offer in compromise.
An offer of compromise is your offer to the IRS telling them how much you can afford in order to settle up your debt with them.
It is important to know that, before you send the IRS an offer of compromise, you realize the reasons that they accept them. One of these must be true.
If your offer of compromise is due to your inability to pay, the IRS is going to look at your income, expenses, and even your assets.
There are times when they won’t accept your offer of compromise. These include:
When you send in your offer of compromise to the IRS, there are several forms that you have to fill out. You will also have to pay the application fee. If you are asking for payment plans, the IRS is going to want at least a downpayment to show them that you are serious. If you are going to pay it off all at once, they are going to want at least 20 percent of the total owed at this time.
However, the truth is that they only accept a small number of offers in compromise. If the IRS reject the offer, you can file an appeal in the first 30 days.
If you have questions or would like a consultation about your specific tax situation, contact us online or give us a call at (800) 790-1507.