Why does the IRS accept Offers in Compromise or settle with the taxpayer?
The federal government, just about like anyone else you may owe money to, has various business situations in which they cannot collect the debt. The IRS has a system in place. It is a formal agreement in which the federal government has the authority to compromise the full amount of the tax because a situation exists that the IRS can collect more money in the long run by settling the tax bill. So, the OIC is a formal agreement that binds the government once the agreement is signed. You could win the lottery the next day, however the agreement is still binding.
The Authority of Law in this matter:
In case you are a legal buff, Section IRC 7122 whereas the Commissioner of the IRS, under Treasury Regulation 301.7122-1 has the authority on one of three grounds to settle these cases.
Why does the IRS Settle your case?
Filed Under: Tax Help | Uncategorized
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