Easing Your IRS Worries: Reasons to Consider an Offer in Compromise
Dealing with tax debt can be terrifying. It’s natural to feel overwhelmed and powerless in such circumstances. However, succumbing to fear isn’t the solution. The longer you delay taking action, the more interest and penalties accumulate, causing even more strain on your financial stability. In this article, we’ll explore a potential solution for tax relief called the IRS Offer in Compromise (OIC).
Understanding Your Options
Even when you think it’s impossible to pay off your debt, it’s important to look into all the different ways you can repay. Although the IRS has a reputation for being serious about debt collection, they can actually be fair when it comes to helping you pay off taxes you owe and dealing with old debts.
Whether you have unpaid taxes to the IRS or you haven’t filed your taxes for past years, you could be eligible for programs that streamline and speed up the process of paying off your debt. Among these programs is the offer in compromise.
What is an Offer in Compromise?
An offer in compromise allows eligible individuals to resolve their IRS debt for substantially less than the full amount they owe. While it is widely known, it is a frequently misinterpreted aspect of the tax code, and navigating its intricacies can prove to be quite difficult. Not everyone who owes taxes will qualify for the offer in compromise. Even if they do, it can still be tough to deal with the IRS.
This is why enlisting the assistance of a tax resolution expert is critical when you have outstanding tax liabilities. Without the guidance of an expert, the IRS could dismiss your offer. This, in turn, will result in a continuous escalation of your owed amount due to additional penalties and accruing interest.
Exploring the Eligibility Options
To assess your eligibility for an Offer in Compromise (OIC), the IRS examines various factors such as your capacity to make payments, income, expenses, and the equity of your assets. Essentially, the OIC program is intended for individuals who are truly incapable of settling their entire tax debt, especially if doing so would result in significant financial hardship.
It’s important to note that the IRS may reject your offer if they believe your offer is insufficient based on your reasonable collection potential (RCP).
Benefits of a Successful Offer in Compromise
If the IRS accepts your offer in compromise, you can experience significant relief from your tax debt burden. You will not only be able to settle your debt for less than the full amount you owe but also release any tax liens. Additionally, the IRS will cease all collection efforts related to the resolved debt.
While the OIC can be a valuable solution for those struggling with tax debt, it’s not a quick fix. It requires careful consideration and proper execution. Success depends on accurate documentation, skillful negotiation, and adherence to IRS guidelines.
Working With A Tax Resolution Expert
If you’ve received a tax due notice from the IRS, you need to pay immediate attention. The IRS expects quick payment, and without an offer in compromise, you may have limited choices. Delays could worsen your situation, but working with a tax resolution professional can turn things around.
A seasoned tax resolution specialist is well-versed in IRS programs, including the offer in compromise. Even if you’re ineligible, they can explore alternatives, helping you settle debts while sustaining your finances. For tax concerns, contact our resolution firm at 775-245-4357. We offer a free, confidential consultation to discuss your options and achieve permanent tax solutions.