Settle Taxes with an Offer in Compromise Submitted by: Back Taxes Help, LLC
(OPENPRESS) September 17, 2009 -- Settling taxes with an Offer In Compromise (OIC) often times gets overlooked. Believe it or not, many people facing tax debt are not even aware of the fact that this offer exists. This is an agreement between the taxpayer and the IRS in which the total amount paid is less than the actual liability. In the long run this benefits both parties. The taxpayer is able to settle taxes without paying all they owe – which helps them to stay in a better financial position. And at the same time, the IRS gets paid more than they would if the taxpayer decided to do nothing
A recent study shows that an Offer In Compromise leads to the taxpayer paying only 13 cents on the dollar. In other words, they are getting off easy because the IRS is not asking for the entire amount due. The only problem with this is that the IRS does not accept an offer from every taxpayer. In fact, they are turned down roughly 85 to 90 percent of the time. So even if you want to take advantage of an Offer In Compromise, which you should, there is a good chance that the IRS will not accept it.
A lot of people know about using an Offer In Compromise because it allows them to save money. But they are not aware of the fact that this can be a long, detail oriented process. Unlike a payment plan or simply paying in full, when you opt for an Offer In Compromise you are going to have to put forth a lot more time and effort because not only is an Offer In Compromise rarely accepted, but there is risk of having your OIC not accepted and therefore only having the 20% (of your total offer) you are sending to the IRS just get applied to your outstanding balance.
For most, the very first step is contacting a firm that can help you settle taxes. They can give you information on the pros and cons of an Offer In Compromise, as well as your other options. Find a firm that specializes in helping taxpayers who are in your shoes.
With an Offer In Compromise you can settle taxes for pennies on the dollar. This is what most people in tax debt dream of. Unfortunately, it is up to the IRS to decide if you are eligible and having an experienced professional on your side is a must. If you are looking for more information on an Offer In Compromise and are looking for help with tax debt, visit TaxDebtHelp.com.