I cant pay my delinquent taxes. Will the IRS accept a Compromise offer?
June 10, 2014
Q) I cant pay my delinquent taxes. Will the IRS accept a Compromise offer?
A) The IRS may accept an offer in compromise (OIC) if you can show that you are unable to pay your taxes in full. There are three factors that the IRS will consider when evaluating your OIC:
- Doubt as to liability: The IRS may accept an OIC if there is doubt as to whether you actually owe the taxes. This could be because there is a mistake on your tax return, or because the IRS has not followed the correct procedures in assessing the taxes.
- Doubt as to collectibility: The IRS may accept an OIC if there is doubt that it will be able to collect the full amount of the taxes owed. This could be because you have no assets or income, or because you are unable to work.
- Effective tax administration: The IRS may accept an OIC if it is in the best interests of the government to do so. This could be because it would be more expensive for the IRS to collect the full amount of the taxes owed, or because collecting the full amount of the taxes would create an undue hardship for you.
If you are considering submitting an OIC, you should consult with a tax advisor to determine if you are eligible and to help you prepare your OIC.