What is an Offer in Compromise?
An Offer in Compromise is an agreement between you and the IRS which resolves your tax liability by allowing you to pay back less money than the total amount you owe. For instance, an OIC might allow a taxpayer to pay only $5,000 to resolve $100,000 worth of tax liability. Most State taxing authorities also have State OIC programs that may have different name variations and different procedures.
Both individuals and businesses can qualify for the IRS OIC. Because of the IRS’s in-depth review process, an OIC can take up to 24 months to be approved or denied. However, if an Offer is approved, you can save thousands of dollars in the repayment of your tax liability.