The offer in compromise process is really the heart of tax accounting. There are almost always extenuating circumstances surrounding the need to submit an OIC, but at its core, preparing an excellent OIC is key to settle your tax debt for pennies on the dollar. Call 877-541-6901 right now for tax settlement consultation.
This article covers three types of (OIC) offer in compromise:
- Doubt as to Liability
- Doubt as to Collect-ability
Doubt as to liability (DATL) comes into play when a taxpayer doesn’t owe the tax the IRS claims they do. This isn’t a question of amount or inability to pay the requisite tax, but rather a claim that a certain portion of the tax isn’t owed at all. Doubt as to liability can be applied in numerous circumstances, some of which may include: Call 877-541-6901 right now for tax settlement consultation.
- The tax was discharged fully in bankruptcy.
- The statute of limitations ran out on collections.
- The tax has been incorrectly or erroneously assessed.
- The tax has been assessed to the wrong taxpayer.
- The IRS misplaced an amended return.
Doubt as to collect-ability (DATC) is what most people associate with offer in compromise. This offer comes into play when the taxpayer doesn’t dispute that the tax is owed but has no way of paying the full amount owed. A doubt as to collect-ability offer will be based on what the IRS calls reasonable collection potential, or RCP. There are three components when calculating reasonable collection potential: equity, income, and allowed expenses. Call 877-541-6901 right now for tax settlement consultation.