IRS Offer in Compromise information and update.

IRS Now Charges a $150 Filing Fee for All Offers in Compromise

IRS charges a $150 non-refundable processing fee for all Offers in Compromise submitted for consideration in its "Pennies on the Dollar" settlement program.

In an effort to curtail the filing of frivolous and erroneous Offers that only serve to slow the processing of legitimate Offers, IRS charges this filing fee that must be paid when the Offer is initially submitted for consideration.

IRS Policy Change For OICs

IRS is currently receiving significantly more Offers in Compromise than their system can currently process.

IRS policy has been to return as many OICs as possible to taxpayers informing them that their Offers are "Not Acceptable For Processing." By returning as many Offers as possible as quickly as possible, IRS hopes to cull out Offers that will not meet their stringent requirements for processibility and acceptance of literally tons of paperwork.

Undermanned and outgunned, Fort IRS is circling its wagons and assuming a defensive posture to deal with the massive influx of unacceptable paperwork being filed by taxpayers and their representatives.

Incorrectly prepared Offer forms account for over half of all filings in the Offer in Compromise program, say IRS executives.

All taxpayers who file an OIC will have to pay the application fee with their submission unless the offer is based solely on doubt as to liability, or the taxpayer’s total monthly income falls at or below income levels based on the Department of Health and Human Services poverty guidelines.

Please note that the first time you load form 656 Offer in Compromise it may take a few moments to load on your computer since Adobe Acrobat Reader will load first followed by a 48-page set of IRS forms and instructions.

Form 656 Offer in Compromise    
This new 48-page set of forms and instructions contains all the forms necessary (656, 433-A, and 433-B) to offer to pay IRS less money than you actually owe them in order to completely rid yourself of your unpaid tax liability.  This Offer in Compromise form must always be accompanied by form 433-A below for all taxpayers and also by form 433-B below for self-employed individuals.