How to pay your taxes – if you can’t pay in full: Offer in Compromise (Part I)

You may be eligible for an Offer in Compromise if you can’t pay the amount you owe in full or through an IRS installment agreement.

By requesting an Offer in Compromise, you are asking to settle unpaid taxes for less than the full amount you owe.

The IRS may accept an Offer in Compromise if:

· They agree that your tax debt may not be accurate,

· You have insufficient assets and income to pay the amount due, or

· Because of your exceptional circumstances, paying the amount due would cause an economic hardship or would be unjust.

For an Offer in Compromise to be considered, you must pay an application fee and make an initial or periodic payment for all Form 656 submissions. However, low income taxpayers may qualify for a waiver of the application fee and initial or periodic payment.

For more information, please see the Low-Income Certification form found in Form 656-B, Offer in Compromise Booklet.

Next week – Additional IRS Offer in Compromise information

(IRS Publication 594 and (TTT 09/17/19)