Our client came to us with a unknown tax liability. She also needed her 2009 tax return prepared. After preparing her 2009 tax return, we determined that she owed approximately $30,000 in taxes and a total of $35,000 with penalty and interest. After reviewing the financial statement we made the determination that she qualified for an Offer In Compromise.
Her liability incurred was based on life insurance distributions that were never paid back. These distributions go back to the year 2000, however, when she couldn’t pay back the amount of money taken over the last 10 – 11 years, it was taxable in the most recent year. Our client is just under the age of 30 years old. She works as a secretary for a tech company in the local area. She doesn’t make much money, has 1 child, and very limited resources to pay her tax liability. We offered the value of her assets consisting of equity in two vehicles, totaling just over $5,000. The Offer In Compromise doubt as to collectibility was the appropriate Offer In Compromise to file.
After the IRS was aware of how the liability was incurred, reviewed the financial documentation, and discussed the Offer In Compromise we submitted, they agreed on a settlement. The taxpayer was very happy with the results needless to say. If you are looking to settle on your tax liability and want to know if you qualify for an Offer In Compromise, call us now at 720-398-6088 or learn more about our Offer In Compromise tax resolution service.