If your tax liability at the end of the year is more than you can afford to pay, the IRS may be willing to work out a solution that minimizes financial hardship. For instance, your attorney may recommend establishing a payment plan, or pursuing an offer in compromise to lower your overall tax burden. With these arrangements, the IRS may agree to waive a portion of your unpaid taxes and allow you to pay back the remainder with an installment plan.

Who Qualifies for an Offer in Compromise?

The IRS weighs a variety of factors when deciding whether to accept your offer, including your income, the amount of liquid assets you possess, and your other monthly expenses. To qualify, you must have filed all required tax returns and be up-to-date on your estimated tax payments for the current year. You should also have already received a bill for at least part of the debt covered by your offer.

How to Submit an Offer

Before making an offer in compromise, you should ensure that your taxes for the current year are being paid. Next, you’ll need to consult the IRS’s Offer in Compromise Booklet to calculate your minimum offer and fill out the required forms. Your offer submissions should include your initial payment, along with a nonrefundable $186 application fee.

Why You Should Hire an Attorney

Submitting an Offer in Compromise is a complex process, and even relatively minor mistakes can cause the IRS to reject your offer. This could leave you with a tax burden you can’t pay, potentially resulting in IRS seizures of your retirement savings and other assets. A skilled attorney with an in-depth understanding of the system will handle the details for you and represent your interests with the IRS.

For more than a decade, Kerr County, TX residents have relied on Corey C Davis CPA Attorney at Law for help navigating the complexities of the tax code. If you’re facing a tax bill you cannot pay, their experienced professionals will work with the IRS on your behalf to minimize the financial burden. To schedule your consultation, visit their website now or call their offices at (830) 257-8800.