An accepted offer in compromise can be the difference between being able to pay a year’s assessed taxes and having to file for bankruptcy. A good tax attorney can be a great help during the process, and having professional legal aid can make the amount of the taxes that you have to repay considerably less than it was originally.
The Very Basics
An offer in compromise is a file of paperwork telling the IRS why the taxes they originally assessed to you are impossible for you to pay within a reasonable amount of time. It is not a legal loophole to escape taxes that you have the means for but do not want to pay, nor is it a method to reduce the amount of taxes that you have to pay if you feel that you should not have to pay them. It is, however, a last-ditch effort that stands between you and declaring bankruptcy because of a lack of funds to pay the taxes while still paying for your other legal obligations.
An offer in compromise is also incredibly complicated, because you also have to draft a potential payment plan and decide between a lump-sum payment and a series of smaller payments. This is when you hire a good tax attorney to help you navigate the vague details of tax law, which can be extremely confusing. In Utah, for example, the only requirements for filing an offer in compromise is that you have to be unable to pay your assessed taxes within a reasonable amount of time. There are no legal bounds placed on the amount of money you must attempt to pay, nor is a reasonable amount of time ever defined.
Getting Your Offer Accepted
To craft a successful offer in compromise, it is paramount that you accurately fill out all of the forms. Intentionally or accidentally misrepresenting any part of your situation will greatly increase the chance of your offer being rejected, and in some cases can be cause for a fraud charge. A professional tax attorney is extremely valuable in ensuring the accuracy and completion of all of the necessary paperwork, and can help you determine both an amount you feel that you will be able to successfully repay and whether it will be better for you to attempt a single lump-sum repayment or multiple, smaller repayments.read more reviews at http://www.carnahanlaw.com/IRS/compromise.html.
An offer in compromise can be one of the most important sets of paperwork you fill out in your life if you ever run into financial trouble. A professional tax attorney can be the most important part of the entire process, facilitating the navigation of the complexities of tax law and making sure that all of your paperwork has been properly completed, as well encouraging you during the process. Whether you end up filing your offer in compromise with the assistance of a tax attorney or you decide to go through the process on your own, the legalities are vastly complex, and can make or break your situation.