Tax FAQs

Q: Is an Offer in Compromise worth it?

It definitely can be! We have helped a handful of clients slash tens of thousands of dollars off their tax bills. It all depends on the taxpayer’s current financial situation and qualifications.

Q: Can I file for a tax settlement myself?

While it is possible, it is not recommended. Although Offer in Compromises are a great solution for many taxpayers, their acceptance rate is not very high. In 2019, the IRS only accepted 33% of all the OICs received. Your chances of getting accepted greatly increase if the Offer in Compromise is assembled by a tax resolution specialist!

Q: Will filing an Offer in Compromise negatively affect my credit?

Good news: No! An Offer in Compromise, if accepted, can actually have a positive impact on your credit score as it will reduce the amount of debt you owe.

Q: How long does it take to settle with the IRS?

Processing times for Offer in compromises vary. However, taxpayers should expect the IRS to take at least six months to investigate your case and decide whether to accept or decline your offer.

Fun fact: An Offer in Compromise is automatically accepted if the IRS does not make a decision within two years of receiving the OIC.

Q: Can I still file an Offer in Compromise if there is a lien on my account?

Yes, you can! In fact, if your offer is approved by the IRS, the lien will be removed once the offer amount has been fully paid.

Q: How can I get my Offer in Compromise accepted by the IRS?

In order for the IRS to accept an offer in compromise, the taxpayer must show they cannot afford to pay their tax debt based on their current financial situation, and offer a settlement amount that accurately reflects what they can afford to pay in a reasonable amount of time.

Q: What is an Offer in Compromise?

An offer in compromise is an agreement between the taxpayer and the IRS to settle the full amount owed in back taxes, penalties, and interest. It can be a very beneficial solution for taxpayers that genuinely cannot afford to pay their tax debt down.

Q: I owe the IRS money and I can’t afford to pay them, what do I do?

Well, there are a few different options available to taxpayers that owe the IRS. These options include: payment plans, short-term extensions, and offer in compromises. For an in-depth overview of these strategies, visit our Tax Resolution page!

Q: What is tax debt?

Tax debt is any amount of taxes that you owe to the IRS after the tax return filing deadline. Anytime you do not pay the tax balance on your federal tax return before the due date, you are incurring tax debt. It is important to pay back your tax debt as early as possible because the IRS can charge penalties and interest until the balance is satisfied.