In Zumo v. Commissioner, T.C. Summary Opinion 2013-66, the U.S. Tax Court concluded that the IRS was correct in rejecting an offer in compromise based on doubt as to collectibility. The case provides a good overview of the IRS collection process and how the IRS evaluates offers in compromise. Facts & Procedural History Dr. Zumo… Continue reading Example of How the IRS Evaluates Offer in Compromise for Doubt as to Collectibility
Category: Offer in Compromise
Offer in Compromise Rejected Where Records of Household Member Not Provided
In Winters v. Commissioner, T.C. Memo. 2012-183, the U.S. Tax Court concluded that the IRS correctly rejected an offer in compromise submitted based on doubt as to collectibility based in part on the taxpayer not providing records to establish the income of a person who resided in his home. Facts & Procedural History Mr. Winters… Continue reading Offer in Compromise Rejected Where Records of Household Member Not Provided
Offer in Compromise: Documenting the Value of Assets
The IRS carefully examines the value of the taxpayer’s assets when it considers whether to accept an offer in compromise based on doubt as to collectiblity. Even a few dollars can result in a rejected offer. Substantiation is key. The Wright v. Commissioner, T.C. Memo. 2008-259, case is an example. It involves a $2,000 offer… Continue reading Offer in Compromise: Documenting the Value of Assets
Offer in Compromise Deemed Accepted by the IRS
The IRS consumes volumes of information. It processes this information largely by processing paper forms. This includes paper forms submitted by you, the taxpayer and your tax attorneys, and by internal forms created by IRS employees. This inefficient paper form submission and processing is complemented by an insistence on sending taxpayer notices by mail. The… Continue reading Offer in Compromise Deemed Accepted by the IRS
New Offer in Compromise Legislation
As discussed in a previous post, Congress has been toying with making changes to the IRS offer-in-compromise program. These changes were included in the “Tax Increase Prevention and Reconciliation Act”, which was signed by President Bush on May 17th. New Changes – Offer In Compromise As such, offers in compromise filed after the magic date,… Continue reading New Offer in Compromise Legislation
Congress Proposes Changes to the IRS Offer in Compromise Program
The Offer in Compromise (OIC) has proven to be an invaluable tool for taxpayers to resolve tax disputes with the IRS. OICs have allowed taxpayers to come into compliance with our tax laws and they have also allowed the government to collect tax liabilities that would otherwise go uncollected. Yet, Congress has taken a notion… Continue reading Congress Proposes Changes to the IRS Offer in Compromise Program
The Three Offer in Compromise Options
The IRS offer in compromise program is one avenue for settling tax debts for less than the amount owed. There are three different types of offers that can be submitted under this program. The court in Eberhardt v. Commissioner, T.C. Summary 2004-147, addressed each one. The case provides a good overview of how the IRS… Continue reading The Three Offer in Compromise Options