Factors Supporting a Request for an Offer in Compromise Due to Effective Tax Administration

As a taxpayer, you may one day find yourself facing a debt owed to the Internal Revenue Service that you are having difficulty repaying. In this case, there may be an alternative solution available to you. One such potential alternative solution is known as an Offer in Compromise. This is an agreement that exists between the taxpayer and the Internal Revenue Service. There are many types of Offer in Compromise, but today we’re exploring one particular type known as an “Effective Tax Administration”.

Requirements You Must Meet to Qualify

In order to have your request for an Offer in Compromise as a result of Effective Tax Administration considered, you must show that the compromise would not undermine compliance with existing tax laws. In addition, you must show that collection of the full liability will create an “economic hardship” for you. If you cannot demonstrate such a hardship, you must show that regardless of your financial circumstances, exceptional circumstances exist. These circumstances mean that collecting the debt would be detrimental to voluntary compliance.

To show that the compromise would not undermine compliance with the tax laws, you must meet the following requirements:

  • You have no prior history of noncompliance with the filing and payment requirements of the Internal Revenue Code.
  • You have not taken any deliberate actions in order to avoid the payment of taxes that are owed.
  • You have not encouraged others to refuse to comply with the tax laws.
  • You do not have grounds for requesting the compromise as a result of the collectability of the debt or doubt as to the liability provisions.

Obtaining a successful Offer in Compromise is more likely when you seek guidance from an experienced tax professional. We are here to help. We encourage you to reach out by calling our toll free number today at (800) 721-7054.

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