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Is an IRS Tax Settlement Right for Me?

Posted By Wadhwani & Shanfeld | 21-Jan-2016

If you are struggling with old tax debt, you may be eligible for an IRS tax settlement, also called an “offer in compromise.” Through this process, which is similar to a credit card settlement, taxpayers who are unable to pay what they owe can settle by paying a fraction of that amount. An attorney at Wadhwani & Shanfeld can contact the IRS or state tax board and negotiate a settlement on your behalf.

Wondering if this is a good option for you? The IRS or state taxing authority will consider your financial situation when determining whether or not to accept an offer. If you don’t have the assets or income to pay your liability, this may be a good option for you. However, without proof of financial hardship or some other extreme or exceptional circumstance, the IRS is not likely to accept the offer.

Steps to Pursuing an Offer in Compromise

In order to be eligible, an individual must be current with all filing and payment requirements. Those who have bankruptcy cases pending are not eligible. Then, you will need to complete your offer package, which includes forms 433-A and 656(s), together with a $186 application fee and an initial payment for your 656 form.

Your payments will vary based on your offer and which payment offer you choose: either lump sum or periodic payments. While your offer is being evaluated, your payments and fees will be deducted from your total tax liability until your offer is either accepted or rejected.

It is crucial to work with a qualified attorney throughout this process to gather all appropriate documentation regarding your assets, income, total debt, expenses, and hardships. For more information on how an attorney can assist you with an IRS tax settlement, please consult with a Los Angeles debt relief attorney at Wadhwani & Shanfeld.

Receive a free consultation with our firm when you call (800) 996-9932. For your convenience, we have offices located in Sherman Oaks, Ontario, Long Beach, Los Angeles, and Lancaster.

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