Get Help For IRS Levies and Wage Garnishments With a Qualified Tax Lawyer

IRS Internal Revenue Code authorizes acceptance of less than full amount of tax debt in any civil or criminal tax law case. This exception is only available if the case has arisin prior to the case's referral to the Department of Justice. For an Offer in Compromise to be accepted, the taxpayer must prove to the IRS that the taxpayer either:

has no means of paying the tax

does not actually owe the tax.

Also known to the IRS as "doubt of liability" or "doubt of collectability"

What If You Don't Really Owe The IRS What They Say You Do?

According to federal tax laws it's up to the taxpayer to prove the amount of tax liability or IRS penalties involve in the case are erroneous. This type of Offer in Compromise can be used if a taxpayer was unable to defend himself against a tax assessment by the IRS, and has discovered new evidence proving the amount of tax liability is incorrect.

Other than cases of 100% penalties, the Examination Division of the IRS rather than the Collection Division will review an OIC1 (Offer in Compromise that cast doubt as to liability). When the Examination Division reviews and OIC1 the IRS will use guidelines similar to those used in audit determinations. For OIC1 to be successful, a tax attorney must establish a valid question of law or fact that would place the tax liabilty in doubt.

What If You Cannot Pay The Amount Owed?

In the most common type of Offer in Compromise the tax attorney makes a representation that based on the taxpayer's financial status the IRS will not be able to collect the entire amount owed. This type of Offer in Compromise will require a detailed review of the condition of the taxpayers finances to determine if the claim is valid.

This type of Offer In Comromis has a very structured method for the IRS to determin the amount owed in the offer.

The total amount offered by the taxpayer should equal the amount of the equity in taxpayer's assets and and additional amount the IRS could collect from taxpayer's future income. This can frequintly be much less than the original tax liability but will still be a serious finacial drag.

Sometime extral consideration can be made for taxpayer's with advanced age, illness or other special circumstances. Tax lawyers often show the IRS a client is in ill heath or advanced age and will be unable to pay the entire tax liability. Another tactic is to show a taxpayer's skills or chosen career is no longer as well compensated as they have been in previous years. Proving valid special conditions or circumstances can very important to the success of an Offer in Compromise.

What If You Have Special Circumstances Or Economic Hardship?

To use econimic hardship as a mechanism for an Offer In Compromise the taxpayer to explain in detail thier exceptional circumstances, showing why demanding the full payment of the tax liability would be place the taxpayer in a situation unfair or inequitable or place them in economic hardship.

After acceptance of an Offer in Compromise, the taxpayer must remain current on all tax obligations for five years. If a taxpayer's Offer in Compromise settlent is accepted and paid in full and later fails to pay current income taxes or other federal tax debts, the Offer in Compromise could be revoked. The agreement to stay current on all tax liabilities after the Offer In Compromise is part of the initial agreement and must be made clear by the tax lawyer to thier client.

About the Author

As a dedicated IRS Tax Lawyer Mary has been helping clients get tax debt relief by negotiating currently non-collectible status, offers in compromise, installment agreements, innocent spouse cases, audits, removing levies, releasing liens, and negotiating penalty abatement. Mary's career as a IRS tax attorney began in 1993 after graduating from Stetson University College of Law. She graduated

Author (getmejustice). Submitted on Sat, 23 Jul 2011 Time: 1:08 AM

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