Tax debt issues generally don't happen in a vacuum. There are a variety of other difficulties a person may be facing at the same time they are dealing with tax problems. This includes financial difficulties.
Sometimes, financial struggles impair a person's ability to be able to pay back their tax debt in full. When a person with a tax debt is facing such severe financial difficulties, they may feel incredibly discouraged and be worried that they will never be able to resolve the debt.
However, there are various options individuals who are facing financial difficulties may have for reaching a workable tax debt resolution. One such option is reaching an offer in compromise with the IRS.
What is an offer in compromise? It is an arrangement in which the IRS allows a person to fully resolve a tax debt they have with a payment that is short of the total amount of the debt.
It is important to note though that there are many challenges that one can face when it comes to getting the IRS to agree to an offer in compromise. For one, there are many complex paperwork requirements related to seeking an offer in compromise. Also, the IRS won't simply let any taxpayer have an offer in compromise. There are various factors the IRS takes into account in its decisions of whether or not to accept a request for an offer in compromise. A list of some of the things the IRS will consider can be found on our page on offers in compromise.
Given these challenges, navigating the offer in compromise request process can have its difficulties and there are a variety of potential pitfalls one could fall into in relation to this process. This is why going through this process alone can be unwise. Experienced tax attorneys can help taxpayers struggling with a tax debt with determining if pursuing an offer in compromise would be a good avenue for them and can work with them throughout the offer in compromise request process to help them try to resolve their tax matter in an acceptable way.