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Options if I am unable to pay at the conclusion of audit

Table of Contents

    Offer in Compromise

    It may be possible to negotiate an “Offer in Compromise” agreement with the taxing authority. An Offer in Compromise is a procedure where you approach a taxing authority and offer to pay them say 25% of the total amount due if they will forgive the other 75% due.

    The cold hard truth is that only approximately 15% of the Offers in Compromises submitted to the IRS for example are accepted. However, if you qualify, you could be forgiven from a significant amount of your tax debt including penalties and interest. There are strict requirements that define who qualifies for these programs and thus not everyone will qualify.

    The taxing authorities typically require a great deal of financial information to be submitted along with an offer and thus I recommended that you work with an experienced Tax Attorney or Certified Public Accountant who can complete and skillfully negotiate your offer. Most Offers are routinely rejected and must be appealed to get them accepted. Lastly, be prepared for the whole process to take up to two years to complete.

    Installment Agreements

    Most of the taxing authorities will allow you to spread your tax liability over a period of time and make monthly installment payments. Once an Installment Agreement has been agreed upon by the IRS, collection activities will stop. It is often beneficial to work with an experienced Tax Lawyer or Certified Public Accountant when negotiating an installment agreement because the IRS all too often will attempt to disallow or understate valid living expenses, in an attempt to maximize the installment payments you will be responsible for which may result in payments that are too high to manage.

    Currently Non-Collectible Status

    In situations where you cannot pay your tax debt, even with a payment plan, a tax professional may be able to persuade the IRS into declaring your tax debt as currently not collectible. This will temporarily stop IRS collection action, but you will receive occasional reminders that you still owe this debt.

    Contact my office to schedule your reduced rate initial consultation to learn how I can assist with your individual tax law concerns.

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    Representing Clients from U.S. and International Locations Regarding Federal and California Tax Issues

    Main Office

    Orange County
    2601 Main St. Penthouse Suite
    Irvine, CA 92614
    (949) 681-3502

    Our headquarters is located in Irvine, CA. Our beautiful 19,700 office space is staffed full-time and always available for our clients to meet with our highly qualified and experienced staff of Attorneys, Certified Public Accountants and Enrolled Agents. We also offer virtual consultations and can travel to meet with clients in one of our satellite offices.

    Outside of our 4 hour initial consultation option, we do not charge travel time or travel expenses when traveling to one of our Satellite offices, or surrounding business districts, where it is necessary to meet personally with taxing authority personnel, make court appearances, or any in person meeting deemed necessary for the effective representation of a client. To make this as flexible, efficient, and convenient as possible, David W. Klasing is an Instrument Rated Private Pilot and Utilizes the Firms Cirrus SR22 to service client’s in California and in the Southwest by air. Offices outside these areas are serviced via commercial jet airlines. None of these costs are charged to our clients.

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