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Offer in Compromise with the IRS
Also known as how to settle with the IRS for pennies on the dollar, The Internal Revenue Serviceâ€™s Offer in Compromise Program is for taxpayers who have no chance of ever repaying their debt. This sounds like it's a great thing for the taxpayer, and it is. It is an even better deal for the Internal Revenue Service and that's why it is offered.
The reason why an offer in compromise is such a great deal for the IRS is that it gets people back into the system, and allows them get current. This is exactly what the IRS wants. When a person owes a considerable amount of money to the IRS with no way to pay it back, he/she is generally someone who has been out of the system for a long time and they owe back taxes for many, many years.
The offer in compromise is a program designed for taxpayers who owe tens of thousands of dollars or more to the IRS, and who have little ability to pay these taxes. The process for the offer in compromise takes a minimum of six months and generally takes closer to a year to accomplish. There is an application fee of $150 and the taxpayer must either make monthly payments during the application process, or pay 20% of the amount offer up front.
The reason why I think it takes so long to get this process completed is because the IRS intentionally understaffes this department. Even though it is a great program for the IRS to get people in the system, I don't think they always think so, and that is why the staffing levels are so low.
Bloch, Rothman and Associates Ltd. in Denver offers experienced Denver tax preparation and has been helping people successfully complete offers in compromise for the last 20 years. We can help you too. Please call us for a free Denver tax consultation today.