Is a Private Offer in Compromise Possible?

If You Settle With the IRS Via an Offer in Compromise, Will it Be Private?

As you examine your options for addressing tax debt, you’ve likely considered the IRS offer in compromise (OIC) program. This approach provides several benefits, including the possibility of resolving your debt for less than you actually owe.

Unfortunately, there are a few significant downsides worth addressing. Chief among these? The possibility of having your OIC record available to the public.

While most IRS records are off-limits, this is definitely not the case for OIC. Upon submitting a request, it’s possible to view information about accepted OICs, including the name of the taxpayer and the terms of the offer in question.

Why Aren’t Offers Private?

While public availability may seem problematic, there’s actually a good reason for it: avoiding corruption. As a Treasury Inspector general report explains, “In the early 1950s, an IRS employee was indicted for taking bribes from taxpayers seeking to compromise their outstanding tax liabilities…In response, President Truman issued Executive Order 103863 in 1952 directing the IRS to open for public inspection any accepted OIC.”

How OIC Public Inspection Works

As soon as your offer is accepted, a copy of the Offer Acceptance Report will become available for public inspection. This period of public availability lasts for one full year. During this time, those who access Offer Acceptance Reports are permitted to copy them.

The process of requesting a report is fairly straightforward, but it does take longer than nervous OIC applicants might realize. Anybody who wants access to a report during the approved one-year period will need to complete the Offer in Compromise Public Inspection File Form and send it in by fax or mail. Depending on how it’s submitted, it could take up to a month to receive a response.

Whether you’re confident that you want an offer in compromise or prefer to explore alternatives, this process is best navigated under the guidance of the Highland Tax Group. Reach out today to learn more.