Pre-Offer In Compromise Requirements
Before you submit an Offer in Compromise (OIC) to the IRS, you must file all delinquent tax returns. If you send in an OIC and still have unfiled returns, the IRS will return your offer without even considering it.
Even worse, the IRS will keep an initial payment sent with the offer and apply it to your tax debt. Unlike a typical OIC rejection, you don’t have the right to appeal this decision.
Other Important OIC Requirements
The IRS has a good reason for implementing this policy. The OIC program allows some taxpayers to settle their tax debt for pennies on the dollar. Why should the IRS agree to settle your tax debt when they don’t know how much you really owe?
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