I am a Former IRS Agent who worked and taught the Offer in Compromise Program in the Regional Training Center. The Offer in Compromise is a much talked about and advertised as “pennies on a dollar”.
FACTS: Approximately 52,000 are filed each year and that number will be rising at a record pace. 12,000 Offers are accepted each year. The program has an acceptance rate of about 22%.
Offers in Compromise are worked by specialist who only work Offers. Field offices have specialized Revenue Officers that their entire inventory are only these Debt Settlement cases. New York and Tennessee also has Offer groups that are worked out of the Service Center. All are trained to scrutinized the Offers. I bite my tongue in saying this however it is my firm belief that the Agents working these cases look first to reject rather than to accept, why, simple because it is far less work. It is much easier to send a rejection letter than fully document the case for acceptance. Therefore the Agents look for anything they can to reject the Offers. Rejections close out of their inventory quickly making the Agent look very efficient in managing their case load.
The Keys to having your Offer accepted.
1.Fully document the case. Get every piece of paper you can and verify every number put on the 433A, the IRS financial statement.
2. Keep up with the Offer. As soon as the case is assigned call the Agent every two weeks to ask for an update. This lets the Agent know you really want this pushed through and that you can send more documents in if necessary. Most Agents will not even contact the Taxpayer or the representative, they will usually just send out a rejection letter. It is the easy way out.
3. Make sure the case makes sense. If you believe the Agent will have questions, send in a additional statement the clarify questions you think will arise.
4. Know that IRS will look at the history of the taxpayer and income levels for the last 5 years. If there have been swings, document the reason for the income swings.
5. Believe of not, many offers are rejected because payments were not turned in with the Offer and Offers were unsigned. Get a 3rd party to look at the Offer for full review.
I have been in this business a number of years and truly believe you would be a fool not to have professional representation. Find a professional tax firm specializing in Offers in Compromise, that is your very best chance of acceptance. Make sure such a company have filed at least 100 plus offers.
Former IRS Agents who have worked the Program are best suited for this job, after all, they know the tax policies.
