| If you're experiencing IRS problems, a solution might be | | | | included. |
| an Offer in Compromise or OIC. Taxpayers can | | | | When determining this sum, you can exclude most of |
| negotiate with the IRS. An OIC is an agreement | | | | your household assets and personal effects. Antiques, |
| reached between the IRS and you that resolves your | | | | fur coats, and other luxury items, though, have to be |
| tax liability. In certain circumstances, the IRS can accept | | | | included. |
| less than the full payment. | | | | The figure of your retirement plans also must be |
| Examine the IRS Form 656 booklet before filing an | | | | included, less the taxes and penalties connected with |
| OIC. You'll know if you qualify for an OIC. | | | | cashing them in, and an explanation of how you came |
| To be eligible for an OIC, you must prove to the IRS | | | | to the amount you gave. |
| that you satisfy one of the following conditions: | | | | You may want to perus the list of items you may |
| - Doubt as to liability - There's uncertainty that you | | | | exclude from asset calculation in the IRS Publication |
| actually owe the tax liability or if the assessed tax is | | | | 594, The IRS Collection Process. |
| correct. | | | | The number connected to the payment plan you wish |
| - Doubt as to collectibility - This is doubt on the IRS's | | | | to use is then multiplied by your disposable income, a |
| part that it will be able to collect your bill from you at | | | | figure that can be calculated by subtracting your living |
| present or later. | | | | expenses from your monthly income. |
| - Effective tax administration by giving evidence that | | | | Payment Plans |
| paying the liability is inequitable as it'll cause you | | | | - Deferred offer - your future income multiplied by the |
| extreme financial hardship. | | | | months left on the statute of limitations for your taxes. |
| How Much Must You Offer? | | | | - Short-term Deferred Offer - You will settle the |
| The money that the IRS could take from your future | | | | amount of the offer after 91 days but within two |
| income plus your assets' realization value is the sum of | | | | years of the IRS notification of acceptance. Multiply |
| the OIC. | | | | your future income by 60. |
| The realization value of your assets is determine by | | | | - Cash Offer - You will pay in full within five months of |
| the IRS utilizing a "quick sale value" (twenty per cent | | | | IRS notification that the OIC has been accepted. |
| less than fair market value). Debts on the asset aren't | | | | Multiply your future income by 48. |