You Can Settle Your Tax Liability for Less Than It’s Worth
What a lot of people don’t often know is that the IRS has a special program available that makes it possible to settle tax liability for less than its full value. This is known as an offer in compromise, and it can be used when someone owes a significant sum in back taxes or their tax liability was incorrectly assessed. By paying a certain sum of money to the IRS now, your remaining tax liability can be forgiven.
When determining if an offer in compromise is appropriate, the IRS will evaluate the following:
- Your asset equity
- Your expenses
- Your income
- Your ability to pay your tax debt
Damiens Law Firm, PLLC can help you negotiate an offer in compromise with the IRS if you are overburdened by your unpaid tax liability. The IRS is very selective about who can qualify for this program, and many who apply aren’t excepted. That said, our offer in compromise attorney in Memphis can assess your situation and help you construct an offer that may be more likely to be accepted than if you handled this matter on your own.
How does an offer in compromise work?
If you’re only vaguely familiar with the concept of an offer in compromise, you’re probably wondering why the IRS would agree to settle tax debt for less than it’s worth. You may also wonder why this tax relief measure isn’t commonplace.
The answer to both questions is that offers in compromise are only accepted when the IRS believes that the offer in compromise is greater than the amount of money that could be collected by other means. In other words, if the IRS believes the amount offered by a taxpayer is greater than what could be collected through a wage levy or asset seizure, it is inclined to accept the offer and settle the remaining debt in return.
Who can qualify for an offer in compromise?
Because this is a special arrangement with the IRS, not everyone will qualify. Eligibility will begin by assessing whether or not the taxpayer can afford their debt through installment payments. If this is not possible, then they’ve passed the first hurdle toward eligibility.
Other requirements include the following:
- The taxpayer must have filed all past tax returns
- Payment must have been made on the taxes currently due
- If the taxpayer is a business owner, they must be current with all required federal tax deposits
At Damiens Law Firm, PLLC, our offer in compromise attorney in Memphis can help you determine your eligibility for an offer in compromise. Because this is a very selective program, your application must be carefully prepared by someone who knows what the IRS is looking for in a qualified applicant.
We can help you secure your offer
An offer in compromise is not easy to obtain and it could require complex negotiations with the IRS for your offer to be accepted. Our lawyer at Damiens Law Firm, PLLC has helped previous clients obtain the tax relief they needed through offers in compromise, and we can help you with yours as well.
For more information about how we can help you, please schedule a free initial consultation by contacting us online today.