The IRS faces a 28% increase in the number of requests for Offers In Compromise. The requests by Californians and others behind in their tax payments to pay “pennies on the dollar” has reached almost 60,000 for 2011 when the data was last analyzed.
Why are Offers up? In part the struggling U.S. economy is responsible, and in part it’s the IRS’ own doing. Since the National Taxpayer Advocate labeled the offers in compromise program as one of the most serious problems facing taxpayers from 2001 through 2009, the IRS has been trying to improve and promote the program. It made the OIC form (Form 656) simpler, created a YouTube informational video and began a “streamlined” process for taxpayers with incomes of $100,000 or less and liabilities of $50,000 or less to make deals. A “Fresh Start” initiative is also bringing in more taxpayers to the OIC program.
At the end of last month, the U.S. Treasury published a report entitled “Increasing Requests for Offers in Compromise Have Created Inventory Backlogs and Delayed Responses to Taxpayers” which is available by clicking here.
Forbes Online also has a good explanation of what’s going on at the IRS with regard to the OICs which is available at this link.
Get help from a tax attorney. Call Mitchell A. Port at (310) 559-5259.