We often receive calls from clients looking to save money off of their IRS tax bill. They call with a larger tax liability, or small, and ask if they qualify for an offer in compromise. At times, they do. At times, we can save a significant amount of money off their IRS tax bill. At times the taxpayer has significant financial issues their facing, or health, divorce, family, death, and/or business problems they may be up against. Knowing the taxpayer has a place to go, a hearth with which to warm their financial souls, is ever reassuring to them.
Our client came to us in 2015 with a tax liability as well as several missing returns. As a self-employed person who mostly took to the road for work, she had a hard time once the ball was rolling to catch up with her returns and tax debts. The IRS tax issue continued to snowball and became the worst financial trouble she had ever been in. She was devastated, to say the least. However, after our initial consultation, she felt better knowing there was a multitude of strategies available to her as well as a partner in her efforts to fix the IRS tax issue for good.
We began by contacting the IRS, filing the necessary Power of Attorney form to represent her, and voice our efforts and plan to the IRS. We immediately secured a collection hold on her behalf and began working. Her first step was to file the missing reports. At the time she needed to get caught up with 2010 through 2015 tax returns. We partner with several CPA’s in the Denver community and sent her to one of our trusted partners to prepare the returns for her. In the interim, we began working on her financial form to determine the best short or long term strategy on her behalf. We actually settled on non-collectible prior to filing for an IRS offer in compromise due to the fact the taxpayer also needed to be sure she was current with estimated payments. Once we secured CNC, she was able to work toward getting current and compliant, a feat that took us up through 2017 before we could file for an IRS offer in compromise.
Once the taxpayer became current and compliant we were able to file for a settlement. We prepared the necessary forms, form 433-A OIC and form 656. We made sure all of her returns had processed with the IRS, they had, and she owed over $120,000 when we filed for a settlement. We had to work a few tricks of the trade with her asset position in order to get the lowest offer. We arrived at a settlement amount of just under $7,000.
After negotiations with the IRS (the IRS originally wanted $45,000), pointing out the IRS rules per the Internal Revenue Manual, and updating some of the client’s financial data, we have arrived at a similar settlement amount of around $6,700.
The taxpayer was ever grateful to us and will be able to marry her fiance, something she had been waiting to do until her financial messes were cleaned up. She is now back to living her fullest life, making better money annually, and looking forward to marrying the love of her life.
To see if you or one of your clients qualify for an IRS offer in compromise, please do not hesitate to call upon us. We can be reached at 720-398-6088!