IRS Offers in Compromise – Offer Terms (Part VII) If the IRS accepts the taxpayer’s offer, the taxpayer will have agreed to fully comply with the tax laws. The IRS will keep any refund, including interest, that might be due for tax periods extending through the calendar year in which the IRS accepts the offer.…

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IRS Offers in Compromise – Payment Options (Part V) Lump Sum Cash Offer – Taxpayers may choose to pay the offer amount in a lump sum or in installment payments. A “lump sum cash offer” is defined as an offer payable in 5 or fewer installments within 5 or fewer months after the offer is accepted.…

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IRS Offers in Compromise – Application Fee (Part IV) In general, a taxpayer must submit an application fee for the amount stated on Form 656. Don’t combine this fee with any other tax payments. However, there are two exceptions to this requirement: First, no application fee is required if the OIC is based on doubt…

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IRS Offers in Compromise – Forms to Use (Part III) When submitting an OIC based on doubt as to collectability or effective tax administration, taxpayers must use the most current version of Form 656, Offer in Compromise, and also submit Form 433-A (OIC), Collection Information Statement for Wage Earners and Self-Employed Individuals, and/or Form 433-B (OIC), Collection Information…

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IRS Offers in Compromise (Part I) An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles a taxpayer’s tax liabilities for less than the full amount owed. Taxpayers who can fully pay the liabilities through an installment agreement or other means, generally won’t qualify for an OIC…

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IRS Definition of Terms – you may find helpful  (Part VI) Tax Module — Part of a taxpayer’s account which reflects tax data for one tax class (MFT) and one tax period. For example: (1) Taxpayer has filed 3 Forms 1120, 12 Forms 941 and 3 Forms 940 within a three-year period. He has only one…

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IRS Definition of Terms – you may find helpful  (Part V) Taxpayer Delinquent Account (TDA) – A computer generated printout indicating that the taxpayer’s account has reached a delinquent status. TDAs are sent to the respective districts for collection action (aka Bal Due). Taxpayer Delinquent Investigation (TDI) – A computer generated printout indicating that a taxpayer is…

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