Author Box
Articles Categories
All Categories
Articles Resources

Offers in Compromise - The Bad, the Worse and a Ray of Hope

January 30, 2012 | Comments: 0 | Views: 61

We've discussed the unrealistic expectations that national tax services raise in their advertisements of Offers in Compromise - "We paid pennies on the dollar!" exclaims a well-tanned couple sitting in lounge chairs by the water and some very large boats.

The fact of the matter is that the way in which the IRS calculates your income and resources available for payment there is no savings. The IRS will use the liquidation value of any asset you have in determining the amount of tax you can pay. Couple that with their unrealistic standard numbers for living expenses and you have to be at the bottom to get any break. Now, you may be at the bottom having lost your home, liquidated your retirement accounts and other assets, lost your job and now working at a much lower wage - you probably will qualify. So in the context of the commercial - the couples got their tan from working outside and are just resting in front of those boats before they get back on the job.

The successful OIC has more to do with timing than anything else. If you are at the bottom then you may be able to get a big break from the OIC process and put that liability behind you, allowing you to get on with your financial life.

The worst case is still being at the bottom and not being able to pay off your tax debt. This is the worst of both worlds and requires working with the IRS to allow you progress on your resolving your debt. You should consider a couple of guiding principles when you find yourself in this situation.

1. Staying in contact with the IRS buys you time, and time is valuable. You don't have to be Facebook buddies, but a call once a month lets the IRS know you're working on the situation and lets you know what they're going to do.

2. There is nothing wrong with small, even very small, monthly payments. Make those payments with a money order purchased at your local grocery store. They're cheap and the IRS will not know your bank account. Speaking of that - it's a good idea to use a bank account for your everyday banking that the IRS does not know about. Key point - I'm not telling you to hide accounts - but there is not duty to supplement information after you change accounts.

3. If you do have a tax lien filed against you keep in mind that the IRS does not want your home. Unless they suspect fraud or other illicit activity, the day you receive notice of your lien is the last you'll hear of it for some time. True it does keep you from borrowing against your home, but if you're in bad enough shape to have a tax lien, you probably don't qualify for a loan anyway.

The best news is the IRS fresh start program that allows you to take an active role in your financial recovery and get your tax issues addressed.

Consult a tax professional about your particular problems and be wary of national providers and their claims of settling for "pennies on the dollar".

San Antonio attorney Martin Cantu invites you to visit his website,, for more information on how to obtain the legal help you need.

(c) Copyright Martin Cantu - All rights reserved.

Source: EzineArticles
Was this Helpful ?

Rate this Article

Article Tags:

Tax Lien


Irs Tax Help


Offer In Compromise


Tax Debt

The 3 Month Payday Loans is most suitable options for the people who do not possess assets. There are a variety of loan options for the people who are willing to pledge assets against the cash

By: Cameron white l Finance > Personal Finance l July 09, 2013 lViews: 561

For many people, bankruptcy can make their world fall apart. The apparent loss of reputation coupled with the inability to take financial decisions can deter anyone from thinking clearly. But all is

By: noragwilt l Finance > Bankruptcy Lawyers l November 18, 2012 lViews: 304

If you are availing payday loans with monthly payments, it is easy for you to obtain quick money from online lending companies.By getting the best deals of loan, you can save money in terms of

By: Malen Cheks l Finance > Loans l November 16, 2012 lViews: 289

Loans online have become the popular source of income and people can make smart decision of taking it.Now, don’t go anywhere and sit in your home silently. Such deals would bring you money without

By: Marsh Jone l Finance > Loans l November 13, 2012 lViews: 288

Loans for the unemployed would let you feel comfortable with your unstable conditions due to jobless period.If you compare the rates of a few lenders, you would definitely get the suitable lender to

By: kelse roy l Finance > Loans l November 13, 2012 lViews: 467

By taking cash advance for bad credit, it is easy for you to improve your credit status. This loan is useful to relieve financial stress. This loan is totally free from credit verification and

By: Honard Nork l Finance > Loans l November 09, 2012 lViews: 301

So, you just landed a job with a good company on a decent package. The year went fine, and then you saw your colleagues talking about tax planning and filing of returns. But you are totally clueless.

By: Nishant S Agrawall Finance > Taxes Incomel June 20, 2012 lViews: 216

Is there any difference between a credit and deduction? We hear these words almost every day, but what do they mean? Is one better than the other? How can they affect my taxes and my yearly tax

By: Greg J Olsonl Finance > Taxes Incomel May 22, 2012 lViews: 134

There are many ways that people can minimize their taxes, but it often requires a certain degree of planning. Something that planning even need to take place during the and throughout the tax year

By: Greg J Olsonl Finance > Taxes Incomel May 21, 2012 lViews: 149

Why is it that so many Americans living abroad are behind on their tax filing requirements? The reasons are varied and nuanced, but breaking it down and compiling all the various reasons into a few

By: Horace W Reichartl Finance > Taxes Incomel May 15, 2012 lViews: 152

Be it returns, plans or self-assessments; managing tax affairs can often seem complex and daunting. Yet with millions of people unsure if they are paying too much tax, it is important that we are

By: John T Hughesl Finance > Taxes Incomel April 13, 2012 lViews: 169

I also assert that the accountant's copy of the judgment debtor's tax return is discoverable, because of The Internal Revenue Service Restructuring and Reform Bill of 1998 (HR 2676). This bill

By: Mark D Shapirol Finance > Taxes Incomel April 07, 2012 lViews: 213

Discuss this Article

comments powered by Disqus