Q&A of the Week April 5, 2023
Question
What is an Offer in Compromise?
Answer
An Offer in Compromise is an opportunity for a taxpayer to apply to the IRS to settle tax debt for less than the full amount owed.
An Offer in Compromise may be a good option if you can't pay your tax bill or if paying your tax bill will cause financial hardship.
When determining if an Offer in Compromise will be accepted, the IRS considers the following:
Ability to pay
Income
Expenses
Asset equity
IRS Form 656-B must be used to apply for an Offer in Compromise. You can find it here: https://www.irs.gov/pub/irs-pdf/f656b.pdf