Offers in Compromise
The IRS has issued a consumer alert advising taxpayers to beware of promoters' claims that tax debts can be settled for "pennies on the dollar" through the Offer in Compromise program.

Some promoters are inappropriately advising indebted taxpayers to file an Offer in Compromise (OIC) application with the IRS. An OIC is an agreement between a taxpayer and the IRS that resolves the taxpayer's tax debt. The IRS has the authority to settle, or "compromise," federal tax liabilities by accepting less than full payment under certain circumstances.

However, an OIC may be considered only after other payment options have been exhausted. If taxpayers are unable to pay their taxes in full, there are other payment options, such as monthly installment agreements, that must be explored before an OIC can be submitted.

Further information:
www.irs.gov/newsroom/article/0,,id=120169,00.html
...back to 5 February 2004

Offers in Compromise
Starting November 1, 2003, the IRS will begin charging, with some exceptions, a $150 application fee to process offers in compromise. An offer in compromise (OIC) allows taxpayers to settle their tax liabilities for less than the full amount.

Further information:
www.irs.gov/newsroom/article/0,,id=117346,00.html
www.irs.gov/businesses/small/article/0,,id=111910,00.html
...back to 31 October 2003