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Offer in compromise may help avoid scams

On Behalf of | Dec 3, 2021 | Tax Debt

Many Atlanta residents may find themselves turning over various ideas in their mind when they are struggling with money problems. When it comes to tax debt, they may fear drawing more attention from the IRS and many consider hiring settlement companies who claim that they can work wonders at reducing an outstanding balance. Unfortunately, many of these companies do not follow through with what they claim and typically only put the taxpayers further in debt due to high fees for their services. Instead, individuals may want to investigate an offer in compromise.

Sadly, tax scams are around every corner, but the IRS itself offers various programs that could help taxpayers pay off their outstanding tax balances. One of those options is an offer in compromise. Essentially, this option allows the taxpayer to negotiate with the IRS in hopes of reaching a settlement for a lower amount than what is owed. Of course, this option only applies for those who qualify.

Other quick facts about an OIC that are important to know include the following:

  • If approved, the IRS could accept a settlement that is thousands of dollars lower than the original amount.
  • The exact reduction amount depends on the specifics of each case.
  • All required tax returns must be filed and other necessary payments made.
  • The IRS will not provide the taxpayer with any money; the OIC only reduces the amount the taxpayer owes.

Though an offer in compromise may seem like a dream come true, it is important to remember that it is not the best option for everyone. As a result, interested Atlanta taxpayers may want to thoroughly explore this option and determine whether they may qualify. They may also want to discuss the details of their situations with experienced tax attorneys who could help apply for OICs or find the tax relief option that best suits a person’s needs.