Offer In Compromise Calculator

According to IRS Doctrine the formula that is utilized, is a forensic analysis of the taxpayers current net worth coupled with an appropriate consideration of the taxpayer’s future income potential. Right about the turn of the century, the IRS instituted a new amendment know as the Deferred Payment Offer. The Deferred Payment Offer when invoked allows the taxpayer to pay  the discounted value of all there hard assets plus a nominal recurring payment for the remainder of the statute of limitations for collection due to the IRS.

Execution of an offer in compromise, is first received by an offer coordinator of the IRS where it is examined..  An examination is necessary to determine if the taxpayer is currently in IRS compliance, and is not in the middle of a bankruptcy proceeding. After these prerequisites have been met,  the form is shuttled to the IRS service center for a formal search and further review of all  tax records to determine the exact tax liability due.  The offer can again be rejected if the taxpayer is not in full IRS compliance.

The Offer In Compromise is then sent to a Revenue Officer for an extensive forensic analysis again.  Offer in Compromise Officers do the internal investigation to determine if anything has been missed, The taxpayer may be further questioned by the IRS are asked to supply more information like bank statements, stock ledgers etc.

The IRS has 3 plans which they offer to taxpayers when they submit their offer in compromise.  The Offer part of the offer in compromise can be paid within 90 days in full.  The taxpayer should offer the  (quick sale value) + the total amount the IRS could expect to collect over a 48 month period

The IRS uses this exact formula to make there determinations.

QSV Quick Sale Value +  Present Value of Income Equals Offer in Compromise (QSV + PVI = OIC).  The IRS adds up the quick sale value of everything you own and then adds the amount of the value of your ability to pay.

According to IRS Doctrine they offer a short term repayment plan.  It requires that the taxpayer repay the IRS in full within a 2 year period.  IRS doctrine dictates the (QSV) Quick Sale Value of everything the taxpayer posses plus the total amount the IRS could collect in 60 months or the  ten-year statutory period for collection.

No comments