IRS Offer in Compromise Process

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Jul 15, 2021

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An IRS Offer in Compromise is a program for settling back IRS tax debts for less than what is owed. It is ideal for someone who has had a consistent stream of income over a long period of time, but lost that stream of income and has no promise of future employment. While the IRS Offer in Compromise is the IRS’s most popular program, it requires an intensive review, and can turn into a lengthy process, ranging from four months to two years.

Tax Offer In Compromise: The process

Justin Hein, Managing Attorney for Roni Deutch, A Professional Tax Corporation explains the process:

A tax attorney will generally conduct a brief confidential analysis of the situation to see if there is anything that might disqualify you or another taxpayer from succeeding with an IRS Offer in Compromise. Some law firms may provide that initial consultation for free, while others charge what is typically a very a modest fee for the initial analysis.

If the tax attorney concludes there are no apparent roadblocks to an IRS Offer in compromise, and the taxpayer is prepared to go ahead with an application for an IRS Offer in Compromise the attorney puts in the time and effort and uses his or her skill to develop the terms of an Offer in Compromise. Exactly what that Offer in Compromise will consist of is something of an art based upon the tax attorney’s knowledge and years of experience in dealing with Offers in Compromise with the IRS. The tax attorney will propose an Offer in Compromise that involves the lowest cost and most comfortable terms to the taxpayer, yet still be acceptable to the IRS. Then, with the client’s approval, the tax attorney will present the Offer in Compromise to the IRS and negotiate on your behalf with the IRS agents and staff to convince them your Offer in Compromise should be accepted.

Other IRS tax debt relief options

An IRS Offer in Compromise is not the only way for a taxpayer to settle their IRS tax debts. There are many other options including Installment Agreements and placement into the IRS’s Currently Not Collectible status. Contact an experienced tax attorney to discuss your situation and options.

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