But statistically, the odds of getting a compromise offer from the IRS are quite low. If you request a transaction offer, we will carefully consider your request; however, we will only consider your offer if you meet the qualification criteria. We'll review your offer to determine if acceptance is best for New York State and other taxpayers. This may, for example, require you to pay all the trust taxes you owe (unpaid sales taxes or withholding taxes, excluding penalties and interest) to reach an agreement.
As a result, we will not accept all offers from eligible applicants. If you make a transaction offer based on the second or third reason, the IRS will consider other factors. At any time, you can request a conference call with the offer manager to discuss areas of disagreement. When you apply, you may show little income in the past 3 months, which could qualify for an ICO (and probably a low bid amount).
The best way to find out if a compromise offer is right for you is to consult with a tax professional who can assess your specific situation and advise you on the best course of action. When an offer is not met, the IRS can collect or file a lawsuit to collect the full balance of the offer or an amount equal to the original tax debt minus any payment received under the terms of the offer. If you don't qualify for a transaction offer or if your offer is rejected, seek debt solutions, such as liquidation and consolidation. Once you know your disposable monthly income and the value of your personal assets, you can include these numbers in the formula to determine what the total amount of your offer should be.
For step-by-step instructions and all the necessary blank forms, including requirements for people with low incomes, read the IRS brochure on pledge offers. You must continue to file and pay all your taxes on time for the period indicated in the offer contract, including any collateral agreements signed as part of the accepted offer. If you don't qualify for low-income certification or haven't checked the low-income certification box, the offer will be returned to you. If you offer to pay a lump sum, your down payment should be 20 percent of the total offer amount.
If you're considering filing an offer for compensation for the IRS tax debt, it's important to do your research and make sure you have strong arguments. If you do it less than a month after the first offer, you don't need a new 656 form, just a letter that increases the amount of money you offer. If you paid an application fee that was returned to you, you must return the application fee to us; any bid payment you paid with the original offer will apply to your new offer.
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