Tag Archives: offer in compromise

IRS Settlement in Cordova, TN

Our great team of IRS Tax Relief experts has succeeded again. Our client, Gregory S. from Cordova, TN has been informed that IRS has accepted his Offer in Compromise settlement. Our IRS Tax Attorneys has put through his $5000 settlement on an IRS tax debt of $34,000.

Gregory now has the Fresh Start he has badly needed. Our team can and will assist anyone in the United States with their IRS tax problem. We offer low, affordable fees so you can get the IRS help you deserve and need.

Our Consultation # is: 1-800-578-3079

Will you be one of our success stories? We are here to provide you with real IRS Tax Relief.

IRS Tax Relief in US

We provide IRS Tax Relief throughout the USA.

IRS Garnishment – IRS Tax Relief

The IRS has the power to garnish, levy or legally seize any income you make to satisfy federal tax debt or taxes owed. IRS Garnishments can apply to your hourly wages, salary, commissions, and bonuses. The IRS will contact your employer directly, serve the IRS garnishment and require your employer to directly send the IRS a portion of your income. Your employer is required by law to comply with the IRS garnishment, typically within one full pay period of receiving the notice from the IRS. The difference between the IRS and most creditors, however, is that the IRS does not need to take you to court to get a judgment in order to garnish your wages, and the IRS can garnish more of your wages than a regular creditor can garnish.

The IRS Garnishment Process

When the IRS seeks an IRS garnishment on your wages for a tax debt that you owe, or use any other legal means to enforce payment of the tax debt that you owe, it will first send you a written notice that sets out the amounts that you owe, including the tax, penalties, and interest. This IRS garnishment notice should also provide you with a due date by which you must pay the balances in full. Assuming that you do not pay the balance in full, you later will receive another notice, entitled “Final Notice of Intent to Levy,” Once thirty days have passed from the time you have received the final notice, and you still have failed to pay the balance due, the IRS can proceed with the IRS garnishment of your income.

The Amount that an IRS Garnishment Can Garnish From Your Wages

The law places limits on the amount that a regular creditor can garnish from your wages. However, these normal limits do not apply to the IRS. Rather, the tax code requires the IRS to leave you with a certain amount of income after the IRS garnishment is enforced on your wages to pay your tax debt. The tax code contains a table that corresponds to the number of exemptions that you claim for tax purposes and sets forth the amount that is necessary for you and your family to pay for basic living necessities. Unfortunately, a garnishment by the IRS can amount to 70% or more of your income.

Stopping an IRS Garnishment

There are a number of different ways in which you can resolve your problem with the IRS. In order to avoid or stop a wage garnishment, you must get back into good standing with the IRS, either by paying your balance in full or entering into a tax payment plan or some other type of resolution.

You Could Enter Into an IRS Installment Agreement

The IRS will stop an IRS garnishment if you enter into an approved installment agreement to pay your tax debt in full over a series of monthly payment installments. As long as you can make the monthly payments and pay off the debt before the debt becomes uncollectible by the IRS, your installment agreement is likely to be accepted by the IRS.

Do An Offer in Compromise

If you qualify and are eligible for an Offer in Compromise, you can settle your debt with the IRS for less than the total amount that you actually owe, based on your financial situation. However, if you are facing an IRS garnishment, you may qualify for this type of IRS tax relief, and your IRS garnishment will stop while your case is being reviewed.

Stop an IRS Garnishment

Stop an IRS Garnishment and Get Happy.

The IRS has the power to enforce an IRS garnishment, levy or legally seize any income you make to satisfy federal tax debt or taxes owed. IRS Garnishments can apply to your hourly wages, salary, commissions, and bonuses. The IRS will contact your employer directly, serve the IRS garnishment and require your employer to directly send the IRS a portion of your income. Your employer is required by law to comply with the IRS garnishment, typically within one full pay period of receiving the notice from the IRS. The difference between the IRS and most creditors, however, is that the IRS does not need to take you to court to get a judgment in order to garnish your wages, and the IRS can garnish more of your wages than a regular creditor can garnish.

The IRS Garnishment Process

When the IRS seeks an IRS garnishment on your wages for a tax debt that you owe, or use any other legal means to enforce payment of the tax debt that you owe, it will first send you a written notice that sets out the amounts that you owe, including the tax, penalties, and interest. This IRS garnishment notice should also provide you with a due date by which you must pay the balances in full. Assuming that you do not pay the balance in full, you later will receive another notice, entitled “Final Notice of Intent to Levy,” Once thirty days have passed from the time you have received the final notice, and you still have failed to pay the balance due, the IRS can proceed with the IRS garnishment of your income.

Be Placed Into Currently not Collectible Status Due to Financial Hardship

If you can prove to the IRS that the IRS garnishment or other collection action would prevent you from meeting the basic needs of you and your family, then the IRS may temporarily cease its collections efforts for months and even years. In this case, you must show that collection of the debt would be unfair because your financial circumstances are so bad. The IRS will require financials.

You Could Change Employers

If you change employers, your IRS garnishment will not proceed, and it will only be a matter of time before the IRS once again tracks your new employer down and reissue a new wage garnishment. This is only a temporary solution, but it can give you a few months of relief. THIS IS REALLY NO SOLUTION.

Temporarily Quit Your Job

Once again this is not a real solution to an IRS garnishment. If your employer will allow you to temporarily quit your job for a period of time, and later return to work, then this tactic will slow down the IRS as well. It will take some time for the IRS  to discover that you have returned to work at the same employer and reissue a new IRS garnishment to that employer.

File a Tax Levy (IRS Garnishment) Appeal

If you disagree with the tax levy in any way, you can file an appeal, even if it has been more than 30 days since you received the notice of intent to levy.

If you can prove to the IRS that the IRS garnishment or other collection action would prevent you from meeting the basic needs of you and your family, then the IRS may temporarily cease its collections efforts for months and even years. In this case, you must show that collection of the debt would be unfair because your financial circumstances are so bad. The IRS will require financials.

 

 

Tax Settlement Attorney – IRS Tax Relief

The Tax Settlement Attorneys, at Flat Fee Tax Service, Inc., have assisted thousands of clients to resolve their tax debt problems with the IRS. This includes halting IRS collections just within 24 hours as well as settling your tax debts for much less than you actually owe. Are you facing tax problems? Are you being audited by the IRS? Our Tax settlement Attorneys can assist with understanding tax law and resolve tax levies, IRS garnishments, federal tax liens, back taxes, and tax relief.

The Tax Settlement Attorneys at Flat Fee Tax Service, Inc. are best for handling complex tax issues. With years of successful hands-on experience in tax settlements, tax levies, IRS garnishments, Innocent Spouse and IRS hardships, our Tax Settlement Attorneys have handled 100s of personal tax debt problems and negotiated many a successful Offer in Compromises.

Tax Settlement Attorneys Can Resolve All Of Your IRS Tax Problems

Diminish the amount of tax debt you owe to the IRS. Halt IRS Levies, Federal Tax Liens, and IRS Garnishments. Avoid or Halt an IRS Wage Garnishments in one day. Avert Property Seizures. Stop Bank Levies. Our Tax settlement Attorneys Help You Resolve Tax Problems such as Return Filing Problems – Penalties and Interest – Enforced Tax Collection.

Taxpayers dealing with IRS tax debt problems are desperate to find solutions, and unethical tax relief companies take advantage of misinformed. Ignoring an IRS tax problem is a big mistake. Don’t make a mistake.

Probably just about everyone (including tax pros that should know the difference) get IRS settlement officers and IRS appeals officers confused. What’s the difference between an IRS settlement officer and an IRS appeals officer? A financially struggling taxpayer will settle with the IRS for that amount or that there is a 40% chance your IRS settlement offer will be accepted.

Flat Fee Tax Service, Inc. Represents IRS Tax Settlement Clients In All 50 States.

Free Advice on How to Settle IRS Tax Debt – 1-800-589-3078

The Tax Settlement Attorneys at Flat Fee Tax Service, Inc. offers tax relief services to help you resolve your tax problem. Nearly everybody has gone through some kind of IRS enforcement difficulty and we all know somebody who is going through it now. But few have effective solutions. Too often, Unfortunately, precious few take the time to understand that an experienced Tax Settlement Attorney will have solutions to every IRS problem.

Don’t wait for your IRS tax debt to blow up in your face.

Halt IRS Levies, IRS Garnishments, Federal Tax Liens

The very last thing your family needs is to be hit with a Federal tax lien, an IRS levy or an IRS garnishment of any kind. With the IRS levy abuse continuing, you may not receive the needed tax relief without engaging experienced Tax Settlement Attorney. Don’t wait until the levy and seizure happen. Contact our team in advance to avoid the IRS levy or IRS garnishment. Be proactive and take control of your life. If you owe the IRS back taxes, you may have already experienced an IRS levy, IRS garnishment, seizure, or suffered from the filing of a federal tax lien. In that case, your immediate objective is to get tax relief from an IRS levy or wage garnishment. Now our expert Tax Settlement Attorneys can certainly prevent IRS levies, liens and garnishments just within 24 hours and surely can seek a great resolution for your tax debt.

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FREE AND CONFIDENTIAL CONSULTATION – 1-800-589-3078

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Offer in Compromise – How Much Money can an IRS Offer in Compromise Save Me?

WHAT IS AN IRS OFFER IN COMPROMISE?

The Offer-in-Compromise can be a life-saving form of tax relief for those who truly need it. On average people who settle their debt using an Offer-in-Compromise end up paying less than 20% of the actual amount they owed to the IRS.

Approved by Congress to aid financially struggling taxpayers, an IRS settlement through the Offer in Compromise (OIC) program can be the ideal tax debt solution for resolving your tax problem as it can result in significant savings.

In some cases, your financial situation may make it nearly impossible for you to pay off all your IRS tax debt, even when utilizing tax relief over the long term via an installment plan. In such situations, the IRS may be willing to accept an Offer in Compromise and significantly lower your IRS tax debt.

Here is how an IRS Offer in Compromise works:

  • Through the work of our IRS Tax Attorneys, the IRS acknowledges that there is no feasible way to pay off all your tax debt. This means that you do not have enough income to pay off your tax debt and do not have enough valuable assets that the IRS could seize.
  • Using the IRS guidelines for an Offer in Compromise, you offer to pay the IRS the maximum amount that you can afford even though that amount may fall far short of the actual tax debt
  • If the IRS accepts that the amount of your Offer in Compromise, the IRS will agree to compromise, settle and essentially lower your tax debt to match the amount you can pay
  • Once you have finished paying the agreed upon amount, your tax debt is considered “paid in full.” This is true even if the agreed-upon Offer in Compromise is only a small percentage of what you originally owed

95% OF FLAT FEE TAX SERVICE, INC.’S CLIENTS HAVE RECEIVED AN IRS SETTLEMENT.

Our clients get positive tax relief results.

PER 2016 IRS STATISTICS: 42% OF THE OFFER IN COMPROMISE SUBMISSIONS

WERE APPROVED BY THE IRS.

WE LOVE OUR IRS SETTLEMENT RESULTS.

Getting Help with Offer In Compromise

Yes, a taxpayer can submit their own Offer in Compromise. Our team doesn’t recommend it if you are serious. To have a better chance of approval of your Offer in Compromise, one should utilize the assistance of an experienced IRS Tax Attorney for this complex process. The highly qualified, trained and experienced team at Flat Fee Tax Service, Inc. will work very hard to see if this is the best solution for your IRS tax debt.

To be eligible for an Offer in Compromise our IRS Tax Attorneys must demonstrate to the IRS that collection of the tax would create an economic hardship or would be unfair and inequitable.

For the best chances in successfully negotiating an Offer in Compromise, you’ll want an experienced professional with a successful track record on your side. Flat Fee Tax Service, Inc.’s expert IRS Tax Attorneys are highly experienced in preparing, submitting and settling these tax debt cases. By calling one of our Tax Relief Consultants, we will answer any questions you may have and provide you with a better assessment of your options.

FLAT FEE TAX SERVICE, INC.

GREAT PEOPLE – DOING GREAT WORK

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IRS Tax Negotiation – Solving IRS Tax Problems

If You Owe Federal Income Taxes but Cannot Pay

How does a taxpayer negotiate with the IRS? If the thought of IRS enforcement sends chills down your spine, you can relax. IRS Tax Attorneys at Flat Fee Tax Service, Inc. specializes in helping you resolve your tax dilemmas. Depending on your financial circumstances and how much you owe, you may be able to make payments over time or pay a reduced amount, either in a lump sum or in installments. In some cases, you won’t have to pay your back tax debt at all, at least for now. In some cases, you can have your back tax obligations permanently forgiven

Installment Payment Agreement

If you can afford to make monthly payments to settle your tax obligations, an IRS installment agreement may be the best strategy you can take. However, the IRS may require for you to complete Form 9465: Installment Agreement Request and Form 433-F: Collection Information Statement by mail. A taxpayer should be careful what they disclose to the IRS as their main purpose is to collect past due income taxes the Department of Treasury.  If you have assets or income, you may want to consider contacting our tax relief team prior to submitting financials.  In addition, while you are making payments through a payment agreement, don’t look for any tax refunds – they will be appropriated to offset your past due to balance.

Partial Payment Settlement Agreement

If a taxpayer wants to negotiate a partial payment settlement agreement, a taxpayer will need to submit Form 9465 along with form 433-F and a letter explaining why you wish to be granted a reduction in your total back tax obligation. You will have to provide financial substantiation, and you may want to consider having all IRS installment agreements reviewed by an IRS Tax Attorney prior to submission. If your request is granted, you will make installment payments just as you would with a regular installment payment arrangement.

Offer in Compromise – The Ultimate IRS Settlement

When you see or hear those ads promising to settle your tax bill for “pennies on the dollar,” the program those ads refer to is the Offer in Compromise. There are three categories under which the IRS accepts Offer in Compromise requests:

  • Doubt as to Liability: The amount of tax assessed is incorrect
  • Doubt as to Collectability: This is the category most often used. The person filing under this category must demonstrate that he or she will likely never be able to pay the full tax obligation due to financial hardship or some other compelling reason.
  • Effective Tax Administration: Requests for relief under this category do not dispute the amount of the tax. Rather, the claim is that collecting the tax would create an injustice. Elderly or disabled taxpayers often use this category.

THE CATEGORY YOU SHOULD BE CONCERNED WITH IS “DOUBT AS TO COLLECTABILITY”.

Traditionally, an Offer in Compromise involves tedious paperwork and long waits while the IRS processed requests. However, in 2011, the Fresh Start program was instituted which will provide additional relief and a more streamlined process under certain conditions. To request an Offer in Compromise, file Form 656: Offer in Compromise and Form 656-A: Income Certification for Offer in Compromise Application Fee and Payment.  Offer in Compromises have a very low acceptance rate, and you may want to consider hiring a professional to help your chances of success if you feel that you may qualify.

95% OF FLAT FEE TAX SERVICE, INC.’S CLIENTS HAVE HAD A SUCCESSFUL IRS SETTLEMENT.

PER IRS STATISTICS, IN 2016 THE IRS APPROVED 42%

OF ALL OFFER IN COMPROMISE SETTLEMENTS.

Tax Penalty Abatement

If you are able to pay your entire back tax debt, but just want a break on the IRS penalties that have been tacked on, the Tax Penalty Abatement program may provide tax relief. You must provide a compelling reason for requesting a tax penalty abatement, such as a death in your immediate family, long-term unemployment or significant property damage or loss due to a natural disaster. You can request a tax penalty abatement by writing a letter explaining your circumstances, by requesting an in-person interview with a tax professional or by filing IRS Form 843Claim for Refund and Request for Abatement. You only get one opportunity at an IRS tax penalty abatement, so, you better do it right.

Currently Not Collectible Status a/k/a Financial Hardship

If you simply cannot pay what you owe to the IRS, you may request that your account is placed in Currently Not Collectible or Financial Hardship status. You will need to provide detailed financial information through a Form 433A Collection Information Statement for Wage Earners and Self-Employed Individuals. If your request is granted, you will still owe taxes to the IRS, but collection efforts will be temporarily halted.Your circumstances will be re-evaluated under certain conditions and your stay of the collection could be lifted. If you owe less than $10,000, this is “the way to go”. If you owe more than $10,000, you should be looking for an Offer in Compromise settlement.

Waiting Out the Statute of Limitations

Depending on your circumstances, you may be able to wait out your tax obligations and have back tax debt wiped from your record. The statute of limitations for federal income taxes is generally ten years unless fraud is involved. But calculating the statute of limitations can be tricky. The clock does not begin to run until taxes are assessed by the IRS, and the clock stops temporarily if you file bankruptcy or if you file a dispute or a lawsuit against the IRS. If you intend to take this strategy, you must consult with an experienced IRS Tax Attorney to obtain accurate dates and other essential information.

The Best IRS Help

IRS Problem Solvers

FLAT FEE TAX SERVICE, INC. 

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FREE AND CONFIDENTIAL TAX CONSULTATION:  1-800-589-3078

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Getting Offer in Compromise Help

The Offer in Compromise can be a life-saving form of tax resolution for those who truly need it. On average people who settle their debt using an Offer-in-Compromise end up paying less than 20% of the actual amount they owed to the IRS.

Approved by Congress to aid taxpayers, an IRS settlement through the Offer in Compromise program can be the ultimate solution for resolving your tax debt problem as it can result in significant savings.

In some cases, your financial situation may make it nearly impossible for you to pay off all your tax debt, even when utilizing tax resolution over the long term via an installment plan. In such situations, the IRS may be willing to accept an Offer in Compromise” and significantly lower your tax bill.

95% OF FLAT FEE TAX SERVICE, INC.’S CLIENTS WHO SUBMITTED AN OFFER IN COMPROMISE HAVE BEEN APPROVED.

PER IRS STATISTICS FOR 2016: 42% OF ALL OFFER IN COMPROMISE SUBMISSIONS WERE APPROVED.

Here is how an IRS Offer in Compromise works:

  • Both you and the IRS acknowledge that there is no feasible way for you to pay off all your tax debt. This means that you do not have enough income to pay off your tax debt and do not have enough valuable assets that the IRS could seize.
  • You submit an Offer in Compromise to pay the IRS the maximum amount that you can afford even though that amount may fall far short of your actual tax debt.
  • If the IRS accepts that the amount of your Offer in Compromise to pay is the most that it could reasonably expect to collect from you, the IRS will agree to compromise and essentially lower your tax debt to match the amount you can pay
  • Once you have finished paying the agreed upon amount of tax debt, your tax debt is considered paid in full.This is true even if the agreed-upon Offer in Compromise is only a small percentage of what you originally owed

Getting Help with Offer In Compromise

The acceptance rate on all Offer in Compromise submissions is fairly low due to errors or omissions on submissions. In order to have a better chance of approval, one should utilize an experienced IRS Tax Attorney for this complex process. Our highly qualified, trained and experienced staff will work very hard to see if this is the best solution for your IRS tax debt. A tax debt can be legally compromised for one of the following reasons:

  • Doubt as to Liability – Doubt exists that the assessed tax is correct.
  • Doubt as to Collectibility – Doubt exists that the taxpayer could ever pay the full amount of tax owed.
  • Effective Tax Administration – There is no doubt the tax is correct and could be collected but an exceptional circumstance exists that allows the IRS to consider a taxpayer’s OIC.

Regardless of the reason, to be eligible for an Offer in Compromise the taxpayer must demonstrate that collection of the tax would create an economic hardship or would be unfair and inequitable.

For the best chances of successfully negotiating an offer in compromise, you’ll want a professional with a successful track record on your side. Flat Fee Tax Service, Inc.’s expert tax attorneys are highly experienced in preparing, submitting and settling IRS settlement cases. Call our team today and find out what your options are and what can be done for you.

FLAT FEE TAX SERVICE, INC.

Good People – Doing Great Work

1-800-589-3089

http://www.flatfeetaxservice.us

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IRS Settlement in Pompano Beach, FL

OUR TEAM HAS DONE IT AGAIN!

Fernando M. from Pompano Beach came to us as a referral from a very satisfied former client. Fernando needed 7 tax returns to be prepared and filed before our Tax Lawyers could work on his IRS settlement. Our team prepared his non-filed tax returns immediately as we needed to have Fernando compliant with the IRS.

Today, we can announce this: The IRS has accepted Fernando’s settlement. Fernando will pay the IRS $2,000 to settle $63,000 of tax debt. This is fantastic news!

Fernando needed a Fresh Start and our successful Offer in Compromise settlement is providing that.

Great job by “the best IRS Help” team in America.

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IRS SETTLEMENT SUCCESS – HUTCHINSON, MN

Offer in Compromise Success ($500 settlement on $68,000 income tax debt): Our tax resolution team announce another successful IRS settlement. Our client, Joseph M. from Hutchinson, MN reached out for our helping hand November 15th, 2015. At that time, Joseph owed the IRS $68,000. He had all of his returns filed, so he was fine with being tax compliant. He earns $6K per month but Joe has $2000 per month in court-ordered child support, which he pays. He also has health insurance that was increasing an additional $300 per month. He had no assets of any kind. Our team, the best IRS help, proved to the IRS that Joe could only pay a total of $500 to settle his $68,000 income tax debt. Now Joe has the Fresh Start he deserves. He will be required to file his tax returns on time and pay whatever he owes for 5 straight years. We congratulate Joe. Who else wants to find out if your income tax debt can be settled?

GIVE OUR TEAM A CALL.

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IRS Fresh Start Initiative – IRS Offer In Compromise Settlement

The IRS, in 2012, expanded their Offer in Compromise program with its Fresh Start Initiative, to help financially struggling taxpayers who are unable to pay their taxes due to financial difficulties. The Fresh Start Initiative, in addition to providing income tax relief to American taxpayers, also helps the IRS keep a check on the number of tax default cases, as it encourages more taxpayers to settle their old income tax debt so they can resume tax compliance.

What Qualifies You For The Fresh Start Initiative?

The IRS, under the Fresh Start Initiative, provides a number of options to financially distressed taxpayers.

1. IRS Penalty Relief

The Fresh Start Initiative allows eligible taxpayers up to a 6-month extension to pay their taxes. The IRS penalty for not paying income tax debt by April 15 is waived off until October 15. If, however, the taxpayer fails to pay their income taxes beyond the revised date, a penalty is charged.

The IRS penalty relief is available to two categories of taxpayers

  • Wages earning individuals who have been unemployed for a minimum of 30 consecutive days.
  • Individuals who experienced a dip of 25 percent or more in their income due to a slowdown.

Fresh Start Qualification Criteria

If you are married and filing jointly, your adjusted gross income must not exceed $200,000. If your filing status is single, qualifying widower, head of household, or married filing separately, the adjusted gross income must not exceed $100,000. In addition, if you have an outstanding of more than $50,000, you will not be qualified to receive a waiver.

2. IRS Installment Payment Plan

The IRS Installment Agreement provision allows taxpayers to pay their income taxes, in installments, in a scenario wherein the taxpayer is unable to pay in full. It also gives taxpayers more time to pay. The threshold for the maximum amount of debt against which an installment plan can be prepared has now gone up from $25,000 to $50,000, with the maximum term for the repayment of installments being 6 years. Though you need to pay less in penalties, the interest will continue to accrue on your outstanding dues.

Taxpayers can set up an installment agreement with IRS by using the Online Payment Agreement (www.irs.gov) without any intervention of an IRS agent. It is, however, essential that they agree to pay the installments through a direct debit mode.

3. Offer in Compromise (OIC) IRS Settlement

The Offer in Compromise provision allows financially struggling taxpayers to settle their outstanding income taxes for less than what they actually owe to the IRS. After the expansion of “Fresh Start” initiative, it has become easier for taxpayers to qualify for an Offer in Compromise settlement, as the IRS has relaxed the qualification standards, and therefore, more people are now eligible to settle with the IRS for less.

USE AN EXPERIENCED IRS TAX ATTORNEY

To apply for an Offer in Compromise (OIC) settlement, the taxpayer needs to file Form 433-A (OIC) or Form 433-B (OIC), and deposit a non-refundable application fee of $186. If, however, the taxpayer qualifies under the Low Income Certification guidelines, they would not have to pay the application fee. In addition to the form and application fee, the taxpayer may also be asked to pay the first month’s installment or 20 percent of the settlement amount, at the time of filing.

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Offer in Compromise or Currently not Collectible?

Failure to meet your annual tax obligation is an invitation to severe financial and legal consequences. The IRS can impose legal penalties, delay reimbursement, and in worst-cases, seize your possessions and put you behind bars. There is no escape from filing and paying your taxes, but the IRS provides a few avenues to help those who are unable to make payments due to financial difficulties. An Offer in Compromise settlement and Currently not Collectible status are two solutions available to help taxpayers who meet the IRS’s financial hardship criteria. Both options, however, have their pros and cons, which you need to be aware of to make an informed decision on which avenue to pursue to resolve your tax issues. To help you decide, we discuss the details in the blog post.

Offer in Compromise

An IRS settlement through the Offer In Compromise program lets the taxpayer settle the entire debt by paying an amount that is less than what is actually owed to the IRS. Certain criteria must be met, then if the IRS agrees to an Offer in Compromise (OIC), the taxpayer should make sure to file their income tax returns on time and pay the tax in full for the next five years.

Offer in Compromise Advantages

  • An Offer in Compromise (OIC) removes a Federal tax lien against the taxpayer.
  • As the income tax debt goes away, you earn more money by not having to pay back taxes.
  • The IRS settlement can be paid in installments.

Offer in Compromise Disadvantages

  • You have to pay $186 as a filing fee to process the request.
  • There is a possibility of the IRS rejecting the request.
  • You must be tax compliant for five years, once the Offer in Compromise (OIC) request is accepted.
  • You must owe $10,000 or more to take advantage of the Offer in Compromise program.

Currently not Collectible Status

If you are unable to pay your income tax debt, the IRS may consider your eligibility for Currently Not Collectible Status. The IRS will cease all collection activities, which includes levies and garnishments until the IRS notices an improvement in your financial condition. The IRS will send a statement that includes detailed information of the income tax debt to the taxpayer every year the account is in CNC (Currently Not Collectible) status. If the taxpayer is not able to pay the amount, the IRS will keep postponing the collection.

Currently not Collectible Advantages

  • You don’t have to pay any amount to the IRS
  • You don’t’ have to worry about tax levies and garnishments
  • The Statute of Limitations continues to run and it may run out on your income tax debt.
  • Currently not Collectible status is your only choice if you owe less than $10,000.

Currently not Collectible Disadvantages

  • Despite your Currently not Collectible (CNC) status, you still owe the IRS and a Federal tax lien, most likely, will be filed.
  • If you do not file a tax return, there is a probability of cancellation of the uncollectible status.
  • A dramatic increase in income can also lead to cancellation of the status.

Making a Decision

If you cannot pay your past due income tax debt, it’s always better to settle the entire income tax debt. Don’t run half the race. Finish the race and get yourself a Fresh Start.

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