Low Cost Tax Relief suggests that an Offer-in-Compromise could be a lifesaver for those who are struggling to pay their taxes. Typically, taxpayers who use an Offer-in-Compromise end up paying less than 20% of the actual amount they owe to the IRS. This program, which was established by Congress to help taxpayers, can result in significant savings and is an ideal solution for resolving tax problems.

 

In cases where taxpayers are unable to pay off their entire tax debt, even with a long-term installment plan, the IRS may accept an Offer-in-Compromise and substantially reduce the tax bill. To apply for this program, taxpayers must demonstrate that collecting the tax would cause an economic hardship or be unfair and inequitable.

​

To be considered for an Offer-in-Compromise, taxpayers must submit an application along with a user fee of $205 and 20% of the offer amount if they choose to pay in a lump sum. If the IRS determines that the amount offered is the most it can reasonably expect to collect, it will agree to a compromise and lower the tax debt to match the amount the taxpayer can afford to pay.

​

The acceptance rate for Offer-in-Compromise applications is generally low due to errors or omissions in submissions. Therefore, it's recommended that taxpayers seek professional assistance from experts like Low Cost Tax Relief to increase their chances of success. Their highly qualified and experienced staff will work diligently to determine whether an Offer-in-Compromise is the best solution for your tax debt and provide assistance with the application process.