Offer in Compromise

 

The Internal Revenue Service and the New York Department of Taxation and Finance have extensive powers to collect on delinquent tax obligations. There are, however, procedures in effect that allow taxpayers to compromise their tax liability.  For the taxpayer with the right set of facts and circumstances, an Offer in Compromise is a most powerful loophole.

The grounds for an Offer in Compromise are:

 

Doubt as to Collectibility, which means that within the remainder of the statutory period for collection, doubt exists that the taxpayer could ever pay the full amount of tax liability due;

      

 Doubt as to Liability, which means that doubt exists as to whether the taxpayer owes part or all of the assessed tax liability; and

       

 Effective Tax Administration, which means that the taxpayer has no doubt as to the correctness of the tax liability due, and that the potential of collection exists for the full amount of the obligation, but an exceptional circumstance exists where collection of the tax liability would create an economic hardship or would be unfair and inequitable.

 

Section 509 of the Tax Increase Prevention and Reconciliation Act of 2005 made major changes to the offer in compromise program.  Nonetheless, your tax liability may be compromised at substantially less than the tax liability assessed.  Get back on track.  Click Here! and set up an appointment to discuss your Offer in Compromise.