Taxpayers may be eligible for an Offer in Compromise if they owe more tax than they can pay. However, not everyone qualifies for an Offer in Compromise. To determine eligibility, taxpayers must ask these questions:
- Do I receive Social Security income, Social Security disability, pension payments or public assistance?
- Am I over age 60?
- Are my total assets worth less than I owe?
- Have I had a significant reduction in income?
- Is my tax debt older than seven years?
- Are my tax returns in full filing compliance?
- Is the business that I was a principal member of defunct and closed?
Taxpayers who answer yes to two or more questions may be eligible for an Offer in Compromise.
When you sign and submit an offer, you agree to the waiver and suspension of any statutory periods of limitations for assessment and collections of the tax liability while the offer-in-compromise is pending, during the time the offered amount remains unpaid and for one (1) year after the satisfaction of the terms of the offer-in-compromise.
Contact us for more information or fill out the Offer In Compromise Statement of Offer.
APPLICATION FOR AN OFFER IN COMPROMISE
Checklist for required information
Please include with your Statement of Offer and financial statements any of the following which apply. The department will review all information.
- Signed Statement of Offer.
- Completed Collection Information Statements (financial statement personal - Form 10896) and attachments.
- Social Security statement of benefits or disability income for all submitting parties.
- Copies of your last federal tax return for all submitting parties.
- A copy of your IRS Offer-in-Compromise agreement.
- Last three consecutive paystubs. Include paystubs for all parties submitting this offer.
- All bank statements for the last 90 days (most recent) for all bank accounts held by all submitting parties.
- Copies of medical bills not covered by insurance, court-ordered restitution, fines, child support, alimony, and student loan statements.
- Statement of prognosis from your doctor if applicable to your offer.
- Copies of credit card statements for last 90 days for all credit cards held by all submitting parties.
- List of accounts receivable.
- Copy or rental/lease agreements on property you own and lease. Copy of lease agreement if your rent is over $1,000.00.
- All copies or statement(s) of dividend, trust income, 401K, or other retirement accounts for all submitting parties.