What is an Offer in Compromise?

An Offer-in-Compromise can be one of the best options available through the Fresh Start Program, and taxpayers that meet the strict criteria will benefit tremendously. On average people who settle their tax debt using an IRS Offer-in-Compromise (OIC) end up paying less than 20% of the amount owed to the IRS.

The Offer-in-Compromise was approved by congress to aid taxpayers, An IRS Offer in Compromise (OIC) can be a great solution to relieving you from your tax liability and can result in significant savings. 

There is an initial $205 fee to apply for an Offer in Compromise. The IRS will want 20% of the offer amount if the taxpayer is approved for the payment method. 

How Do You Qualify For An Offer In Compromise?

In order to qualify for an Offer in Compromise (OIC), you must first ensure that you are compliant with the IRS. There are three main situations where the IRS considers an Offer in Compromise (OIC) there are also other eligible considerations to take into account. 

1. Doubt As To Collectability: When the IRS doubts it will be able to collect taxes in the future.

2. Doubt as to Liability: The IRS doubts that your tax bill is correct. If the assessor makes a mistake or if the examiner refuses to accept your documents. Also if you have new documents proving you owe less tax. 

2. Effective Tax Administration: If paying the IRS your taxes would create a financial hardship or financial difficulty.