It can be a legitimate option if you can't pay. FAQs about at-risk offers · Appeal your declined offer at. Sometimes it's possible to wipe the slate clean with a huge discount. If you qualify for something known as a transaction offer, known as an offer or OIC, the IRS will accept less than the amount a taxpayer owes on a tax bill and cancel it.
Under the commitment offering program, the Treasury may commit all or part of any outstanding tax debt that is subject to administration under the Revenue Act. If you offer to pay a lump sum, your down payment should be 20 percent of the total offer amount. To initiate a formal appeal, file IRS Form 13711, Request for Appeal of a Transaction Offer within 30 days of the date of the rejection letter. If the Treasury determines that the submission of a transaction offer does not meet the criteria set out in the specific grounds, the submission may be rejected.
Often, instead of referring appeals to the Office of Appeals, the IRS will reconsider your offer and begin further negotiations. The State Treasurer has given certain divisions of the Treasury the authority to accept or reject a transaction offer. When you request a transaction offer, you are responsible for completing and including several forms. If you don't qualify for a transaction offer or if your offer is rejected, seek debt solutions, such as liquidation and consolidation.
In general, the IRS only accepts offers that are equal to the maximum amount you could pay within a reasonable period of time. Submitting an offer to the IRS is a formal process; you can't just call the IRS and say “Let's make a deal.” You can make payments while waiting for the IRS to decide whether to grant you a transaction offer. A transaction offer can be submitted based on doubts about collectability or the receipt of an accepted federal offer in the form of a commitment before the taxpayer's opportunities to challenge the tax debt expire. The IRS accepts less than half of the transaction offers it receives, so your proposal is likely to be rejected.
To appeal the rejection, file Form 13711 within 30 days of the rejection letter, identifying the parties to the denial that are contesting and stating their reasons. This is how an IRS compromise offer works, what is needed to qualify, and what you should know about the program.