Settle Tax Debt through Offer in Compromise – Former IRS Settlement Agent – Jacksonville, Miami, Ft.Lauderdale,Tampa – Florida

by Fresh Start Tax | Oct 31, 2013 | Offer in Compromise, Tax Settlements

If you want to settle your tax debt through the process of and all for compromise it only makes sense to use a former IRS settlement officer who knows the system, the protocols, and the settlement formulas and theories to get your case accepted by the Internal Revenue Service if you are a qualified candidate.
We are a Florida tax firm that has 206 years of professional tax experience and over 60 years of working directly for the Internal Revenue Service right here in the state of Florida. We are A+ rated by the Better Business Bureau.
I  Michael Sullivan am a former IRS revenue officer in teaching instructor with the Internal Revenue Service.
I have worked the offer in compromise program at IRS, I also taught the program and accepted cases for settlement.
A couple years ago, the Internal Revenue Service decided to change it thinking about the settlement program and decided to change its strategy.
The old system produce no results for the IRS or the taxpayer. It was useless.
In the past, it was almost impossible to get offers in compromise through the system but the new IRS fresh start program or IRS fresh start initiative has now made it possible for taxpayers to settle old tax debt.
There are strict qualifications to meet the standards of the Internal Revenue Service.
To make sure taxpayers are not submitting offers in compromise and paying firms thousands of dollars to settle their case with the Internal Revenue Service, the IRS have a pre-qualifier tool to make sure that you are a qualified candidate to settle your tax debt.
You can find that IRS pre-qualifier tool right on our website. Simply go to the homepage and click on IRS forms. You’ll see it listed on a page of forms.
One of the advantages of the IRS settling your case is that the federal tax lien is released, your case closed and will be left alone by the IRS.
The Offer in Compromise Program
An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles the taxpayer’s tax liabilities for less than the full amount owed.
If tax liabilities can be fully paid through an installment agreement or other means, the taxpayer will in most cases not be eligible for an OIC.
To be eligible for an OIC
In order to be eligible for an OIC, the taxpayer must:
1. have filed all tax returns,
2. made all required estimated tax payments for the current year, and
3. made all required federal tax deposits for the current quarter if the taxpayer is a business owner with employees.
In most cases, the IRS will not accept an OIC unless the amount offered by the taxpayer is equal to or greater than the reasonable collection potential (the RCP).
The RCP is how the IRS measures the taxpayer’s ability to pay.
The RCP includes the value that can be realized from the taxpayer’s assets, such as real property, automobiles, bank accounts, and other property. In addition to property, the RCP also includes anticipated future income, less certain amounts allowed for basic living expenses.
The IRS may accept an OIC based on only three grounds.
1. Acceptance is permitted if there is doubt as to liability.
This ground for acceptance is only met when genuine doubt exists under applicable law that the IRS has correctly determined the amount owed.
2. Acceptance is permitted if there is doubt that the amount owed is fully collectible.
This means that doubt as to collectibility exists in any case where the taxpayer’s assets and income are less than the full amount of the tax liability.
3. Acceptance is permitted based on effective tax administration.These are rare but possible.
An offer may be accepted based on effective tax administration when there is no doubt that the tax is legally owed and that the full amount owed can be collected, but requiring payment in full would either create an economic hardship or would be unfair and inequitable because of exceptional circumstances. Such hardships are usually for medical health reasons.
Forms to Use for an Offer in Compromise(OIC)
When submitting an OIC based on doubt as to collectibility or based on effective tax administration taxpayers must use the most current version of:

• Form 656 (PDF), Offer in Compromise, and
• also submit Form 433-A (OIC) (PDF), Collection Information Statement for Wage Earners and Self-Employed Individuals, and/or
•  Form 433-B (OIC) (PDF), Collection Information Statement for Businesses.

 
A taxpayer submitting an OIC based on doubt as to liability must file:

• a Form 656-L (PDF), Offer in Compromise (Doubt as to Liability), instead of Form 656 and Form 433-A (OIC) and/or Form 433-B (OIC).

 
Application Fee for the OIC
A taxpayer must submit a $150 application fee with the Form 656.
There are, however, two exceptions to this requirement.
1. No application fee is required if the OIC is based on doubt as to liability.
2. The fee is not required if the taxpayer is an individual (not a corporation, partnership, or other entity) who qualifies for the low-income exception.
This exception applies if the taxpayer’s total monthly income falls at or below 250 percent of the poverty guidelines published by the Department of Health and Human Services. Section 4 of Form 656 contains the Low Income Certification guidelines to assist taxpayers in determining whether they qualify for the low-income exception.
A taxpayer who claims the low-income exception must complete section 4 of Form 656.
Type of Payment Options to Settle Your Tax Debt through an Offer in Compromise
Taxpayers may choose to pay the offer amount in a lump sum or in installment payments.
A “lump sum offer”
Is defined as an offer payable in 5 or fewer installments and within 24 months after the offer is accepted.
If a taxpayer submits a lump sum offer, the taxpayer must include with the Form 656 a nonrefundable payment equal to 20 percent of the offer amount.
This payment is required in addition to the $150 application fee.
The 20 percent amount is called “nonrefundable” because it cannot be returned to the taxpayer even if the offer is rejected or returned to the taxpayer without acceptance. The 20 percent amount will be applied to the taxpayer’s tax liability.
The taxpayer has a right to specify the particular tax liability to which the IRS will apply the 20 percent amount.
The offer is called a “periodic payment offer” under the tax law if it is payable in 6 or more monthly installments and within 24 months after the offer is accepted.
When submitting a periodic payment offer, the taxpayer must include the first proposed installment payment along with the Form 656.
This payment is required in addition to the $150 application fee. This amount is nonrefundable, just like the 20 percent payment required for a lump sum offer.
Also, while the IRS is evaluating a periodic payment offer, the taxpayer must continue to make the installment payments provided for under the terms of the offer.
These amounts are also nonrefundable. These amounts are applied to the tax liabilities and the taxpayer has a right to specify the particular tax liabilities to which the periodic payments will be applied.
If the IRS accepts the taxpayer’s offer, the IRS expects that the taxpayer will have no further delinquencies and will fully comply with the tax laws.
Failure to met the terms of the accepted OIC/Tax Debt Settlement
If the taxpayer does not abide by all the terms and conditions of the OIC, the IRS may determine that the OIC is in default.
For doubt as to collectibility and effective tax administration OICs, the terms and conditions include:

• a requirement that the taxpayer timely file all tax returns and

• timely pay all taxes for 5 years from the date of acceptance of the OIC.

 
Very Important Note
When an Offer in Compromise is declared to be in default, the agreement is no longer in effect and the IRS may then collect the amounts originally owed, plus interest and penalties.
Any refunds due within the calendar year in which the offer is accepted will be applied to the tax debt.
Appeal a Rejected OIC/Tax Debt Settlement
One of the advantages of using Fresh Start Tax  LLC is that we have a former IRS appellate agent on staff who can help through this process.
If the IRS rejects an OIC, then the taxpayer will be notified by mail. The letter will explain the reason that the IRS rejected the offer and will provide detailed instructions on how the taxpayer may appeal the decision to the IRS Office of Appeals.
The appeal must be made within 30 days from the date of the letter. In some cases, an OIC is returned to the taxpayer, rather than rejected, because the taxpayer has not submitted necessary information, has filed for bankruptcy, has failed to include a required application fee or nonrefundable payment with the offer, or has failed to file tax returns or pay current tax liabilities while the offer is under consideration.
A return is different from a rejection because there is no right to appeal the IRS’s decision to return the offer.
Keep in mind you can always file another offer in compromise.
You can file as many offers in compromise is you want.
Many times once you understand the process it is much easier to refile an offer in compromise correcting previous mistakes.
Call us today and we will walk you through the process of settling your tax debt through the offering compromise.
We are IRS and State specialty firm that deals   with IRS problems, concerns and matters.
We are the affordable tax firm.
 

Offer in Compromise to Settle Your Tax Debt with Former IRS Settlement Agents – Affordable

by Fresh Start Tax | Oct 31, 2013 | Offer in Compromise, Tax Settlements

Offer in Compromise  to Settle Your Tax Debt
I am a former IRS  revenue  officer in teaching instructor with the Internal Revenue Service. I have worked the offer in compromise program at IRS, I also taught the program and accepted cases for settlement.
If you are looking to settle your tax debt with the Internal Revenue Service the process of doing so is through the offer in compromise.
About two years ago, the Internal Revenue Service decided to change it thinking about the settlement program and decided to change its strategy.
In the past, it was almost impossible to get offers in compromise through the system but the new IRS fresh start program or  IRS fresh start initiative has now made it possible for taxpayers to settle old tax debt.
The offer in compromise is not for everybody.
There are strict qualifications to meet the standards of the Internal Revenue Service.
To make sure taxpayers are not submitting offers in compromise and paying firms thousands of dollars to settle their  case with the Internal Revenue Service, they have a pre-qualifier tool to make sure that you are a qualified candidate to settle your tax debt through an offer in compromise.
You can find that IRS pre-qualifier tool right on our website.
You can call us today and we will walk you through the process and the program to see if you are an eligible candidate. One of the advantages of the IRS settling your case is that the federal tax lien is released, your case closed and will be left alone by the IRS.
The Offer in Compromise
An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles the taxpayer’s tax liabilities for less than the full amount owed.
If tax liabilities can be fully paid through an installment agreement or other means, the taxpayer will in most cases not be eligible for an OIC.
To be Eligible for an OIC
In order to be eligible for an OIC, the taxpayer must:

• have filed all tax returns,
• made all required estimated tax payments for the current year, and
• made all required federal tax deposits for the current quarter if the taxpayer is a business owner with employees.

 
In most cases, the IRS will not accept an OIC unless the amount offered by the taxpayer is equal to or greater than the reasonable collection potential (the RCP).
The RCP is how the IRS measures the taxpayer’s ability to pay. The RCP includes the value that can be realized from the taxpayer’s assets, such as real property, automobiles, bank accounts, and other property. In addition to property, the RCP also includes anticipated future income, less certain amounts allowed for basic living expenses.
The IRS may accept an OIC based on three grounds.
1. Acceptance is permitted if there is doubt as to liability.
This ground for acceptance is only met when genuine doubt exists under applicable law that the IRS has correctly determined the amount owed.
2. Acceptance is permitted if there is doubt that the amount owed is fully collectible.
This means that doubt as to collectibility exists in any case where the taxpayer’s assets and income are less than the full amount of the tax liability.
3. Acceptance is permitted based on effective tax administration.
An offer may be accepted based on effective tax administration when there is no doubt that the tax is legally owed and that the full amount owed can be collected, but requiring payment in full would either create an economic hardship or would be unfair and inequitable because of exceptional circumstances.
Forms to Use for an Offer in Compromise
When submitting an OIC based on doubt as to collectibility or based on effective tax administration taxpayers must use the most current version of Form 656 (PDF), Offer in Compromise, and also submit Form 433-A (OIC) (PDF), Collection Information Statement for Wage Earners and Self-Employed Individuals, and/or Form 433-B (OIC) (PDF), Collection Information Statement for Businesses.
A taxpayer submitting an OIC based on doubt as to liability must file a Form 656-L (PDF), Offer in Compromise (Doubt as to Liability), instead of Form 656 and Form 433-A (OIC) and/or Form 433-B (OIC).
 
Application Fee
A taxpayer must submit a $150 application fee with the Form 656. Do not combine this fee with any other tax payments.
There are, however, two exceptions to this requirement.
1. No application fee is required if the OIC is based on doubt as to liability.
2. The fee is not required if the taxpayer is an individual (not a corporation, partnership, or other entity) who qualifies for the low-income exception.
This exception applies if the taxpayer’s total monthly income falls at or below 250 percent of the poverty guidelines published by the Department of Health and Human Services. Section 4 of Form 656 contains the Low Income Certification guidelines to assist taxpayers in determining whether they qualify for the low-income exception.
A taxpayer who claims the low-income exception must complete section 4 of Form 656.
 
Type of Payment Options to Settle Your Tax Debt
Taxpayers may choose to pay the offer amount in a lump sum or in installment payments.
A “lump sum offer”
Is defined as an offer payable in 5 or fewer installments and within 24 months after the offer is accepted.
If a taxpayer submits a lump sum offer, the taxpayer must include with the Form 656 a nonrefundable payment equal to 20 percent of the offer amount.
This payment is required in addition to the $150 application fee.
The 20 percent amount is called “nonrefundable” because it cannot be returned to the taxpayer even if the offer is rejected or returned to the taxpayer without acceptance. The 20 percent amount will be applied to the taxpayer’s tax liability.
The taxpayer has a right to specify the particular tax liability to which the IRS will apply the 20 percent amount.
The offer is called a “periodic payment offer” under the tax law if it is payable in 6 or more monthly installments and within 24 months after the offer is accepted.
When submitting a periodic payment offer, the taxpayer must include the first proposed installment payment along with the Form 656.
This payment is required in addition to the $150 application fee. This amount is nonrefundable, just like the 20 percent payment required for a lump sum offer.
Also, while the IRS is evaluating a periodic payment offer, the taxpayer must continue to make the installment payments provided for under the terms of the offer.
These amounts are also nonrefundable. These amounts are applied to the tax liabilities and the taxpayer has a right to specify the particular tax liabilities to which the periodic payments will be applied.
The statutory time
The statutory time within which the IRS may engage in collection activities is suspended during the period that the OIC is under consideration and is further suspended if the OIC is rejected by the IRS and where the taxpayer appeals the rejection to the IRS Office of Appeals within 30 days from the date of the notice of rejection.
If the IRS accepts the taxpayer’s offer, the IRS expects that the taxpayer will have no further delinquencies and will fully comply with the tax laws.
Failure to met the terms
If the taxpayer does not abide by all the terms and conditions of the OIC, the IRS may determine that the OIC is in default.
For doubt as to collectibility and effective tax administration OICs, the terms and conditions include:

• a requirement that the taxpayer timely file all tax returns and
• timely pay all taxes for 5 years from the date of acceptance of the OIC.

 
Important Note
When an OIC is declared to be in default, the agreement is no longer in effect and the IRS may then collect the amounts originally owed, plus interest and penalties.
Any refunds due within the calendar year in which the offer is accepted will be applied to the tax debt.
IRS Rejection of an OIC, you can appeal!
One of the advantages of using fresh start tax is that we have a former IRS appellate agent on staff who can help through this process.
If the IRS rejects an OIC, then the taxpayer will be notified by mail. The letter will explain the reason that the IRS rejected the offer and will provide detailed instructions on how the taxpayer may appeal the decision to the IRS Office of Appeals.
The appeal must be made within 30 days from the date of the letter. In some cases, an OIC is returned to the taxpayer, rather than rejected, because the taxpayer has not submitted necessary information, has filed for bankruptcy, has failed to include a required application fee or nonrefundable payment with the offer, or has failed to file tax returns or pay current tax liabilities while the offer is under consideration.
A return is different from a rejection because there is no right to appeal the IRS’s decision to return the offer.
Keep in mind you can always file another offer in compromise.
Call us today to receive a free tax consultation or assessment on any potential IRS tax settlement. You can speak directly what tax attorney, CPA, or former IRS agent, manager tax instructor.
Remember, the offer in compromises are not for everybody.
Call us today or walk through the pre-qualifier tool yourself to find out if you are ineligible candidate.
 
Offer in Compromise to Settle Your Tax Debt with Former IRS Settlement Agents