Qualifying for an offer
in compromise (OIC) can be tough, especially with the rigorous requirements and
eligibility guidelines. If your OIC is rejected by the IRS, you have the right
to appeal their decision; however, if there’s little or no change in the
gravity of your financial circumstances, your appeal would probably get
rejected.
If that happens, you can
explore other options to settle your tax debt, usually with the help of a
knowledgeable tax lawyer. In fact, it’s better to consult one before you even
file for an OIC in the first place.
One of the alternatives a tax lawyer may recommend is entering an installment agreement with the IRS. Like other types of installment plans, the IRS will set the term (in months) you’re allowed to pay off your debt. They will also specify the amount you need to pay every month, which will be based on your total debt, your assets, and your ability to pay.
Take note that there will
still be interests included in your monthly payments, which can make your total
payment more expensive than what you originally owe. It could take years for
you to satisfy all your debt, too. If you fail to stick to the payment scheme,
the IRS will consider the agreement a default, which could get you in bigger
trouble with the agency. Make sure to discuss your individual situation with a
skilled tax lawyer to determine if an installment agreement is truly apt for
you.
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