Rejected Offer in Compromise

The IRS is notorious for rejecting solutions designed to ease tax burdens

The offer in compromise (or OIC) has one of the highest rates of rejection; back in 2016, the IRS rejected 57.14 percent of offer in compromise requests. Because of this fact, the mere idea of requesting an offer in compromise may feel like a discouraging and fruitless pursuit. However, having an OIC be accepted is possible if you know what steps to take – and when an OIC is the most suitable solution.

Defining an Offer in Compromise (OIC)

An offer in compromise allows an individual the chance to pay off back taxes at an amount totaling less than what they originally owed. This choice is typically reserved for those who cannot pay off the original sum without risking economic hardship. However, proving your inability to pay the original amount can be extremely difficult. The best route to a successful offer in compromise request involves working with a tax expert who can guide you through the overall process.

What Happens If the Request is Rejected?

There are many reasons why the IRS may reject an OIC request. The first thing you should do is figure out why the rejection occurred. Some specific reasons include:

  • The IRS believes you requested an offer in compromise to delay tax collection.
  • You failed to submit necessary information or submitted the information past the 14-day time frame allotted to you.
  • You’ve filed for bankruptcy in the past.
  • You failed to pay the application fee.
  • You offered an amount considered “too low,” and the IRS believes you can pay more.

Once you have figured out the reasoning behind the rejection, you can move forward with the help of an offer in compromise professional. Together you can work to appeal the rejected offer in compromise.

How to Appeal

You should act as soon as you’ve been notified of your offer in compromise rejection. The window to appeal is small; the IRS requires individuals to appeal within 30 days. The IRS also offers its own tool to assist taypayers in deciding whether or not to appeal. However, seeking the services of an OIC professional is often the better option; they not only can help you to learn whether you should appeal, but also assist you in navigating how to submit your appeal.

Our team at Rocket Tax Relief has the expertise and tools needed to aid you in this process. Give us a call at 800-505-6814 or fill out our online form to get in touch with us. We’ll get in touch with you as soon as possible. We also provide 15-minute tax consultations at no cost.

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