Falling behind on taxes can be stressful. An IRS Offer in Compromise (OIC) may allow you to settle your tax debt for less than the full amount owed.
An Offer in Compromise (OIC) is a formal agreement with the IRS to settle your tax debt for less than the total owed. While it may seem too good to be true, it is a legitimate tax relief option for those who qualify.
Submitting an OIC requires a non-refundable $205 application fee and an initial payment based on the amount of your offer and the payment plan you select.
Approval is not guaranteed, but properly submitted requests must receive fair IRS consideration.
The IRS has strict eligibility requirements for an OIC. You may qualify if any of the following apply:
The IRS may have incorrectly determined your tax liability.
Your assets and income are less than the total debt owed.
Paying the debt would cause undue financial hardship.
Additional requirements must also be met:
All tax returns must be filed and up-to-date.
Include an IRS bill for at least one tax debt in your offer.
No delinquent estimated tax payments for the current year (if applicable).
No open innocent spouse claim with the IRS.
Not currently under IRS audit.
Case has not been sent to the Department of Justice.
Not currently in bankruptcy proceedings.
Business owners must make all required federal tax deposits for the current quarter.
Unsure if you qualify? Use our Offer in Compromise Calculator to check eligibility.
