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Recently, I was asked by a reader: “Will the IRS usually accept an offer in compromise when you owe taxes?”
“Usually” is probably not the right word. But, in the right circumstance, the IRS will accept an offer in compromise every time. You must show the IRS that you do not have the future income or the assets to pay for your tax liability in full before the IRS will accept your offer in compromise. This is done by providing the Form 433-A with the filing of your offer in compromise to show the IRS a total financial picture for your life. The only changes the IRS will make to this form is to ensure accuracy of the value of your assets, but more likely is that they will adjust your monthly living expenses – and by adjust I mean reduce – to be in line with the IRS national standard expenses. If you can show the IRS through the Form 433-A along with the other documents and substantiation that they require you to provide that you do not have enough future income or equity in assets to full pay your IRS tax debt then the IRS will accept your offer in compromise.
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- Using Your Deed to Pay an Offer in Compromise
- Is My Offer in Compromise Based on How Much I Owe?
- Can I File an Offer in Compromise after Setting up an Installment Agreement?
- Do I Have to Pay Money when I Submit my Offer in Compromise to the IRS
- I’ve Submitted my Offer in Compromise – When Will I Hear Back