Have OICs Just Gotten Easier?

The IRS announced new policies for the Offer In Compromise program. on a recent blog post titled “IRS Initiates New Favorable Offer In Compromise Policies” The National Taxpayer Advocate announced that the offer in compromise refund recoupment process will no longer be applicable for tax periods included on the Form 656.

And second, while refunds may still be offset during the time an OIC is pending, the IRS agrees that taxpayers may seek an OBR during this period.

What does this mean to the average taxpayer in collection? Absolutely nothing. The cold hard facts are – almost no taxpayer gets an Offer in Compromise as a way to settle their IRS Collection Case.

In 2020, the last year statistics are available, the IRS settled 7.4 million IRS Collection Cases. Of those settled cases, only 14,288 offers were accepted. That’s right – less than 1/4 of 1% are settled with an Offer in Compromise. And the second change – the offset bypass refund for pending offers – is only available to those “qualifying taxpayers experiencing financial hardship.”

Steven A. Leahy is a tax attorney in Illinois. He was the host of the long-running popular Radio Show “The IRS Radio Hour” heard every Sunday evening on AM 560 The Answer. Attorney Leahy is also the author of the book “Deal With Your IRS Problems Today!” You can get a FREE copy of this important book at FreeIRSBook.com. Or Call 24/7 (312)664-6649

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