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Offer In Compromise
An offer in compromise is exactly what it sounds like–an compromise with the IRS to settle taxes for less than the amount owed. The most frequent type of offer in compromise is doubt as to collectibility. Considering a taxpayer’s income and equity in assets, the IRS determines whether or not the taxpayer will ever be capable of fully repaying their taxes. If their “reasonable collection potential” exceeds the offer, the IRS will not accept it. Another common concern regarding offers in compromise is doubt as to liability. In this scenario, the IRS will reduce the amount owed because they believe that the assessed amount is incorrect. Effective tax administration, the last type of offer in compromise, applies to and helps individuals who would suffer undue financial difficulty by paying the full bill. In most cases, this offer only applies to elderly and disabled people. Because of the elaborate application process to qualify for one of these offers, help from an IRS attorney in Provo is strongly encouraged.
Agreements
IRS Agreements help taxpayers who can pay taxes over time, but not immediately, due to a specific financial situation. To qualify for an installment agreement, an individual must have less than ten grand in back taxes, have filed tax returns for the last five years, and agree to pay all returns for the agreement period. Among other things, a streamlined installment agreement requires that an individual can pay off their back taxes within six years, owes less than fifty grand in back taxes, and is not presently filing a bankruptcy. A financially verified installment agreement consists of similar qualifications; however, the key difference is that the latter does not insist on detailed financial information. A partial payment installment agreement reduces but does not eliminate periodic payments and could potentially result in the forgiveness of remaining taxes. Although both agreements can be helpful to taxpayers seeking relief, IRS lawyers and other professionals in Provo are recommended as a source of help during the process.
Abatement
Similar to an effective tax administration offer in compromise, a penalty abatement helps taxpayers that can pay the liability owed but believe they should not be held responsible for the penalties. In a nutshell, a penalty abatement applies to those influenced by situations out of their control. Situations that apply include divorce, illness, theft, loss of a loved one, natural disaster, and incarceration. IRS attorneys, CPAs, and enrolled agents in Provo are familiar with the IRS formula and the art of persuasion and can help individuals use their difficulties to their advantage.
Jordan F. Wilcox offers tax help in Provo, Utah and the surrounding areas. For more information, visit his website taxhelput.com
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