I am a former IRS agent and teaching instructor with the Internal Revenue Service. Since 1982, IRS Offer Expert.
When I was employed by the Internal Revenue Service I work the offer in compromise program. Not only did I accept and reject offers in compromise, I was also a teaching instructor at the service center to help qualified revenue officers decide which offers to accept and reject.
Given the above information, I can tell you I am a true expert for the IRS offer in compromise and I wish to explain to you whether an offer in compromise is a viable option for you.
Due to social media, marketing and advertising the assumption by the general public is that IRS can settle tax debt for pennies on the dollar.While this is true I warn all taxpayers the use caution before giving your money to it tax resolution company unless you thoroughly check out the business, find out who is working your case within the company and the amount of successful offers in compromise it had accepted by the Internal Revenue Service.
Let me first let you know that IRS does accept offers in compromise and as a matter of fact last year approximately 32,000 offers in compromise were accepted out of the 78,000 that were filed.
The average settlement was $9500 per case but remember that is just an average in not everybody can settle their tax debt for $9500.These numbers are completely based on your unique set of circumstances, financial statement, and ability to pay the back tax within the given 10 year period of time.
There is much information you need to know before you go off filing an offer of compromise and giving your money to some firm to try to pull off some amazing trick because you have been sold abill of goods and bought in to some marketing ploy and they’ve convinced you are a settlement candidate.
It first starts with the review of your personal financial statement which is found on the 433 OIC.
When the offer in compromise gets sent in to the Internal Revenue Service it is met with the reviewer that make sure that you are truly qualified candidate for the offer in compromise program. That reviewer checks the completed form to make sure it is a valid agreement. The offer in compromise is a legal document between you and the Internal Revenue Service.
Also reviewer make sure that all the documentation is attached so that the revenue officer who will work your offer in compromise can move forward.
Approximately one third of all offers in compromise are sent back to the taxpayer because the offers are not filled out correctly or the appropriate documentation is not attached.
IRS will check to make sure all your tax returns are current and filed on the IRS system.
It is critically important you know that you must have all tax returns filed before IRS will process your offer.
You should know that the Internal Revenue Service rejects an offer before it accepts an offer. one of the basic rules is that the revenue officer is lazy and is easier to mark rejected then they go through all the work of accepting an offer in compromise. I should know this is a former instructor of the offer in compromise I see many are revenue officers simply send offers back because some of the eyes were not dotted in the tees were not crossed.
Due to the volume of cases the IRS has, which is over 7500 cases waiting in the IRS Q, is far easier for the IRS to say no then to accept because an average of anywhere between 20 and 40 hours are spent on accepting the offer in compromise.
If you have an offer in compromise accepted, four signatures are generally required for signature as it goes up and down the chain.
So how do you know if the offer in compromise is right for you.
The first place to go is to fill out the IRS pre-qualifier tool for the offer in compromise. Because of so many scrupulous tax companies that have been ripping people off, the IRS wanted to make sure the general public has a tool that they can use to find out if they are prequalified to file the offer in compromise to make sure it is a viable option.
It contains all the necessary information in regard to your income, your expenses and your assets and it predetermines for you whether the offer in compromise is even a viable option for you.
IRS will take a very close look at the liquidity of your assets, your current income, and your monthly expenses before it renders a decision as IRS wants to make sure it collects all the money from you that they can within the 10 year statutory period of time.
One of the questions the agent will want to consider is, can we collect more money over 10 years than accept the current agreement on the table for the IRS offer in compromise.
As a general rule, you will have to give IRS your total liquidity of all your assets before they will even consider the acceptance of an offer in compromise.
IRS on larger dollar cases is a tremendous amount of due diligence.
Why? you may ask is because all offers in compromise are open for public expression of expections at eight regional offices throughout the United States.What I find amazing statistic is that only one person in the United States viewed the accepted offers in compromise at one regional IRS office. To date this year nobody has viewed any of the offers in compromise.
Your offer in compromise must be thoroughly documented which includes all your bank statements for the last six months to a year, all your pay stubs, all your monthly expenses along with certain documentation for assets that have value.
IRS also takes a look at the values of your pensions, your IRA, your business as well.
The offer in compromise is one of the most reviewed documents, it is like going through a mini audit.
Some of the due diligence that IRS will conduct on a larger dollar cases is checking Google, the accurate search engine, Department of Motor Vehicles, real estate records, insurance policies, credit reports, loan applications, insurance policies, and inter-government agency records including those garnered by Homeland security and other such agencies.
Before you contemplate filing the offer in compromise and wasting your money on a company that has promised you they can settle your case for pennies on the dollar, you would be wise to give us a call to have an actual former IRS agent and teaching instructor of the offer in compromise give you the green light.
When you call our office you will speak to true IRS tax experts who knows the system and can tell you what to expect and tell you how to settle for the lowest amount possible.
Call us today for a free initial tax consultation. then you need a ride home and placed
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