How difficult is it to get the IRS to Accept an Offer in Compromise?
Finding out you owe back taxes to the IRS can be a nightmare come true for most people. Owing the government money for taxes can put you in an extremely stressful situation as you attempt to find a way to pay back the money you owe without going broke yourself. One of the best options available is to try for an offer in compromise. This means that you are essentially telling the IRS that you cannot pay the full amount of money you owe in taxes, so you are offering to pay a smaller percentage of what is owed.
An Offer in Compromise can be incredibly difficult to get accepted by the IRS. You have to keep in mind that you are telling the IRS that they will not be getting the full amount of money owed to them. Only 15% of these tax settlements actually get approved by the IRS. This means that you may face several rejections before your offer is finally accepted.
You will need to fill out several forms to help determine the monetary amount you can afford to pay on the amount owed. If you have enough money to cover the full amount or if you own assets that can be used to pay off the amount you owed, you will definitely be rejected. More than likely your first offer will not be accepted. This does not mean you should give up. Try upping the offer a bit and then resubmitting your offer. This can be a lengthy negotiation process, so if you are not really comfortable with your own ability to work with the IRS, contact a tax settlement company that can help you get your Offer in Compromise approved.
If your Offer in Compromise is approved, there are a few things you can do to make sure it does not get revoked. Make sure that for the next 5 years you pay your taxes on time. Failure to pay on time will result in revocation of your offer and the full amount owed is reinstated.
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