Austin Tax Blog


If you are unable to pay tax debts then considering an Offer in Compromise is a safe alternative. Through an offer in compromise application you put up facts to convince the government that you are unable to pay your taxes and so negotiate a solution that works in the favour of both. On approval of the OIC application, you get a chance to pay a much lower amount than the actual tax debt. However, there are many things to consider in order to get an offer in compromise approved.

Things to Consider While Dealing With Offer in Compromise:

Check the eligibility: There is a misconception doing the rounds that everyone with a large debt can apply for OIC. Well, that’s not the case at all. IRS vehemently rejects the Offer in compromise applications of people with a history of outstanding tax returns, non-compliance, tax protestors and delayed tax payments. Therefore, it is advisable to check your eligibility for the application at the first place. Go to a tax expert in Austin and discuss your OIC qualification in detail to avoid any issues.

Bankruptcy is a sin: If your financial records suggest signs of bankruptcy in the past then you may never get an offer in compromise approved. In addition, you should be in compliance with the tax returns process in Austin. They will check the last six years of tax payment records to ensure that you are neither bankrupt nor non-compliant. Again, a history of delinquent taxes gives a bad impression about your tax behaviour.

Automatic acceptance: The offer in compromise guidelines mentions that if an already submitted OIC application is not rejected for 24 months then it will automatically get deemed acceptance. However, there is an exception in cases when the tax liability matter is under judicial proceedings during a part or total of these 24 months.

Liens are an exception: An OIC checklist does not include federal tax Liens which means that even if you get an approval for the OIC application, the Liens cannot be removed from it. You need to still pay the settlement amount for the Lien within a specific time period. On payment of the amount, the IRS allows the release of tax liens.

Scope of ambiguity: There are chances that you may not agree with IRS and thus form an ambiguous situation related to the tax debt. The condition is called doubt as to liability in simple terms and is quite rarely observed. Discuss with an experienced tax service provider in Austin to make sure there is no ambiguity on either side. If you feel you don’t owe tax then check the conditions and rules to bring more transparency into the matter.

Small Business Tax Preparation

If you want to have a success story with OIC application, you need to keep the above mentioned points in mind. In addition, you should hire the best tax service provider in Austin to rule out any chances of rejection. Remember, tax laws keep changing and if you are not updated then you might get into big trouble. Therefore, rely on tax experts to get that much needed approval of the OIC application in Austin.

For queries related to delinquent taxes, Texas property rates or anything that bother you about Taxes in Austin, CONTACT US or just feel free to call us on 512-442-3055, Monday to Friday 10:00 am-4:00om.