Call Now (800) 681-1295
Close

What are the ways Offers in Compromise can be paid

Table of Contents

    1. Lump Sum Cash Offer – in which the amount offered will be paid in five or fewer installments upon written notice of acceptance.

    The advantage of making a Lump Sum Cash Offer is that the Taxpayer’s RCP is usually at it’s lowest under this method. Under the Lump Sum method the Taxpayer’s RCP is basically calculated as the liquidation value of the taxpayer’s assets plus the total amount the IRS believes it could collect through 12 monthly installments (or the remainder of the statutory period for collection, whichever is less).

    NOTE: Generally the collection statute is 10 years from the date that your liability was assessed. If you need assistance in calculating the remaining time on your collections statute, call 1-800-829-1040.

    The disadvantage to this method is that twenty percent of the total amount of the offer must be paid as a non-refundable deposit at the time of the submission of the Form 656 and this amount will not be refunded should the offer be rejected.

    2. Short-term deferred payments for up to 24 months – in which the amount offered will be paid in more than five but fewer than 24 monthly installments upon written notice of acceptance.

    The advantage of making a short-term deferred offer is that the Taxpayer’s RCP is usually at it’s next to lowest under this method. Under the short term deferred method the Taxpayer’s RCP is basically calculated as the liquidation value of the taxpayer’s assets plus the total amount the IRS believes it could collect through 24 monthly installments (or the remainder of the statutory period for collection, whichever is less). The monthly installments called for under the plan must be paid and continued under the terms proposed while the offer is being evaluated. These payments are non-refundable should the offer be rejected. However, the twenty percent non-refundable deposit required under the lump sum cash offer method described above is not required under this method.

     

     

    Tax Help Videos

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

    tax lawyers

    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.

    Satellite Offices

    California
    (310) 492-5583
    (760) 338-7035
    (916) 290-6625
    (415) 287-6568
    (909) 991-7557
    (619) 780-2538
    (661) 432-1480
    (818) 935-6098
    (805) 200-4053
    (510) 764-1020
    (408) 643-0573
    (760) 338-7035
    Arizona
    (602) 975-0296
    New Mexico
    (505) 206-5308
    New York
    (332) 224-8515
    Texas
    (512) 828-6646
    Washington, DC
    (202) 918-9329
    Nevada
    (702) 997-6465
    Florida
    (786) 999-8406
    Utah
    (385) 501-5934