Chicago: IRS Partial Payment Agreement vs. IRS Offer in Compromise
IRS Partial Payment Agreements vs. IRS Offer in Compromise
It used to be the only way you could pay less to the IRS than that you owed was to get them to (somehow) accept an Offer-In-Compromise.
But… there’s a problem. Offers-in-Compromise aren’t approved very often these days. In fact, they are only approved a little over 15% of the time they are submitted.
The odds are not in your favor with this method. And it usually takes a skilled tax attorney to have even a chance of making an Offer-in-Compromise successful.
Now, though, this isn’t the only way. There is another way that you can get the IRS to reduce your debt.
You can use a Partial Payment Agreement.
With a Partial Payment Agreement you prove that you can only afford a certain amount in payments.
And then the IRS can only bill you for that specific amount.
When you are done paying that’s all you owe, and the rest of your debt is forgiven.
But there are a couple of catches.
#1. Documenting how much you can afford is a lot of work. And unless you follow very specific guidelines, the IRS may not accept your proposal.
#2. The IRS reviews Partial Payment Agreements every two years. So you may end up owing more.
#3. If your financial situation improved too much, they can completely terminate the agreement altogether.
Even with these conditions a Partial Payment Agreement can work well for many people.
If you are in trouble with the IRS, then our office can help. We will help you figure out the best option for your situation. Call Opem Tax Resolution – The Law Office of Steven A. Leahy, PC (312) 664-6649. Call Now to schedule your FREE 1 hour Consultation!