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Wednesday, 30 August 2006 |
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If a taxpayer is not able to pay the full amount he/she owes to the IRS, they may seek advantage in making an offer to IRS, which if accepted by the IRS will be in favor of both parties. This offer is known as offer in compromise or OIC. But to qualify for an OIC a taxpayer has to fulfill certain conditions. They have to provide evidence that either the amount of tax enforced on them is doubtful, or that they will never be able to manage such an amount.
IRS can understand such a situation and make a compromise for the taxpayer so that he/she can pay up to a certain amount that they can easily manage without going bankrupt or total financial breakdown. This offer is in favor of the Internal Revenue Service because if they know that the taxpayer would never be able to pay the debt they may ask for at least some amount of it. The taxpayer can free himself from legal issues and other financial problems by filing an OIC. In order to have it accepted by the IRS you need to make sure that you qualify to make that offer. They will thoroughly check your bank statements, pay stubs, and previous IRS records. If they found out that your yearly income is more than or close to the amount you have to pay they will mark it as your future income and reject your offer. |
