Settle Your Tax Debt Using This Lesser-Known IRS Compromise Portal
Similar to how credit card companies offer compromises on large debts by allowing consumers to negotiate ways to trim down what they owe significantly, the IRS offers the same for your tax bill.
Explore: The IRS Has Released Its Top Scams of 2021 — Here’s What To Watch Out For
Learn: Biden and IRS Put Pressure on Crypto Tax Avoidance, Transactions Over $10,000
An offer in compromise (OIC) is an agreement between you and the IRS that settles a tax debt for less than the full amount owed. The offer program provides eligible taxpayers with a path towards paying off their tax debt. The IRS states that you must make an appropriate offer based on what the IRS considers your true ability to pay. It’s important to note that submitting an application does not ensure that the IRS will accept your offer, but rather begins a process of evaluation and verification by the IRS.
Hidden among other online portals that have recently garnered more attention — like the CTC online portal — the Offer In Compromise Pre-Qualifier Portal allows you to see if you are eligible for an OIC for the amount of taxes you owe. You will need to enter your financial information and tax filing status to calculate a preliminary offer amount.
Related: What To Do If The IRS Child Tax Credit Portal Isn’t Working
The IRS makes their final decision based on your completed Offer In Compromise application and their own associated investigation. However, they state that the portal should only be used as a guide. This means that although it may show you can fully pay your liability, you may still file an OIC and discuss your individual financial situation with the IRS.
The pre-qualifier portal is available to everyone except if you are a partnership, corporation or reside in a U.S. Territory, foreign country or are military personnel using an APO or FPO address.
The first basic screening questions will ask if you are in an open bankruptcy proceeding, if you have filed all required federal tax returns, if you have made all required estimated payments and if you are an employer and have made all required federal tax deposits. If you are in open bankruptcy proceedings and answered no to the remaining questions, you will not be eligible for the OIC.
See: Crafty Crypto Tax Dodgers Use Alternative Passports To Avoid The IRS
Find: How To Consolidate Credit Card Debt
Before your offer can be considered, you must:
File all tax returns you are legally required to file
Receive a bill for at least one tax debt included on your offer
Make all required tax payments for the current year
Make all required federal tax deposits for the current quarter if you are a business owner with employees
Full information on the details of the OIC can be found here.
More From GOBankingRates:
Last updated: July 27, 2021
This article originally appeared on GOBankingRates.com: Settle Your Tax Debt Using This Lesser-Known IRS Compromise Portal
