I was a former IRS agent and teaching instructor with the Internal Revenue Service. I worked in the collection division and was a seasoned, experienced, and awarded revenue officer.
I worked at the IRS for 10 years and taught at the regional training center in Atlanta, Ga.
I also work the offer in compromise program where I accepted and denied offers in compromise.
Not all revenue officers work the offer in compromise program because of certain skills, experience and expertise. You received special training when you are moved up to work the OIC program.
More seasoned and experienced IRS agent works the offer in compromise program.
I also taught others what to look for to accept or deny an offer in compromise.
I’m laying out the top 10 tips on how to get your offer accepted and other information.
1. There is an IRS pre-qualifier tool for the OIC.
You can find the pre- qualifer tool on our website site or find it on the government website. Before you give your money to any company who claims they can settle your debt for pennies on the dollar, you best fill out the IRS pre-qualifier tool or call and experience firm to review your case to make sure you are in fact qualified.
2. How long does it take for professional to let you know your qualified?
An experienced tax professional can let you know within about a minute whether you are qualified to settle your tax debt. By the time the person reviews the last page they will almost instantaneously let you know where you stand.
3. What is the most important element of getting your offer in compromise accepted?
Your documented financial statement is the absolute key to getting your offer in compromise accepted. That is the tool that the Internal Revenue Service uses to accept or deny your offer in compromise. It takes a skill tax professional to make sure it is completed with all the proper documentation.
4. What documentation will IRS need for the OIC?
When you fill out the IRS financial statement, IRS will need complete documentation for any dollar number that is placed on the financial statement. IRS will also need at least six month worth of bank statements, pay stubs and anything relative to any number that is on that form. That form must be completely documented. Everything must match up. IRS will be looking for inconsistencies on things that are not matching up on the financial statement and documentation.
5. How does IRS know I’m telling the truth and my financial statement?
The Internal Revenue Service has many search engines to use to find out all about you. The Internal Revenue Service uses internal search engines as well as external searches to find out about you. IRS will use the Accuriant search engine as well as credit bureaus.
On larger dollar cases IRS or use much more due diligence than on smaller cases.
6. Is there a specific formula that IRS uses to accept the offer in compromise?
Absolutely, there is a very simple formula.
IRS wants the sum total of your assets and they want to know what the value of your income and expenses.
Let me explain.
IRS will look at all your assets and find out what the fair market value of those assets are. Real estate will be discounted by 20%. IRS will use that as a base amount to compute the asset part of what is needed for case settlement.
IRS will look at your income and expenses and make sure you fit within the national standards. As you complete the 433oic IRS will apply the national standards expenses against your income. If there is a surplus and as an example I will use $500, IRS will take that $500 and multiply it by the life of the statute.
IRS will add the fair market value of your assets plus the value of your income and add them together. That will be the base amount for the IRS to accept the offer in compromise.
7. What is another important factor for getting your offer in compromise accepted?
I cannot tell you how important timing is. It is best to make sure you’re not in the high season of income. It is best to file an offer in compromise when you are doing the worst.
As an example, if you are real estate salesman and you have just earned a $40,000 commission and you want to file for an offer in compromise you have jeopardized your offer because you’ve just made a large amount of money and that new income you received is going to jack up your average income for settlement.
Therefore, understanding where your income and expenses are will determine the best time to file the offer in compromise.
The offer in compromise requires a great deal of planning on when the best time to file.
8. How long does an offer to compromise take to process?
Currently the offer in compromise takes about nine months to process. You will first receive a letter that they have received your offer and then you must wait to the offer is assigned and sent to a particular offer specialist to work your case. It is best to make sure your offer in compromise is fully documented when sending so they don’t have to send it back because if they do you you may have to start the clock all over again.
9. A very important factor to keep in mind.
Before you send in your offer, you must’ve filed all current tax returns. The first thing that IRS will do is pull up a summary of your case history and all tax returns must be filed or IRS will send the case back.
Also you must be current on withholding or estimate payments or IRS will immediately reject the offer in compromise because you are not current and up-to-date.
Do not overlook this is a sure way to get your offer sent back to you.
10. Accepted Offers in Compromise are a matter of Public Records
The reason IRS is so picky about offers in compromise is because they are a matter of public record.
That’s right, for 18 months after your offer in compromise is accepted your file goes to one of six regional tax sites for public review. Don’t be too afraid this, last year only one person inspected the files, so don’t worry are safe.
In closing, you need to know getting your offer in compromise accepted is an art.
TIPS TO GET OFFER IN COMPROMISE ACCEPTED + Former IRS OFFER SPECIALISTS, REVENUE OFFICER
