Do I need an Attorney to file an Offer in Compromise?
No! Three professionals can represent a taxpayer before the IRS; a CPA, an Enrolled Agent or an Attorney. According to the IRS, the application forms for an Offer in Compromise are made for the general public to fill out.
Should you get help?
I have seen many people try to prepare their own OIC and fail because they do not fully understand the art of dealing with the IRS. Yes, you can submit an Offer in Compromise yourself but if you are trying to considerably reduce your debt, I recommend you rethink your position.
An “accepted” OIC is not the same as a “successful” OIC.
There is more to it. Sure, the average taxpayer can fill out the forms and after spending hours reading and rereading the instructions provide the substantiation needed for an application to be accepted. How do you measure success? To me, success is measured with an approval on the LOWEST DOLLAR AMOUNT the IRS will accept. There are many factors, including timing, to consider that the IRS and the applications do not spell out.
- Did the taxpayer consider past, present and future financial data?
- Did the taxpayer know the right time of the year to submit the application?
- Does the taxpayer know how to reshape the numbers by financially grooming them into a better offer?
- Did the taxpayer know that they should have a plan B?
- Did the taxpayer consult with a specialist about any of this?
The IRS has extremely strict rules which must be followed, but within those rules there are grey areas where interpretation is needed; That’s where a Certified Tax Resolution Specialist can work magic. A Pro understands what information the IRS will accept without throwing up red flags.
Taxpayers tend to overvalue assets
A taxpayer might set the value of work tools at $1,000, but a Certified Tax Resolution Specialist would likely set that value at closer to $100. That is $900 that would have been included in your offer unnecessarily.
Taxpayers tend to over-value assets like cars, especially classic cars. It tends to be an ego thing. Bringing your ego into an Offer in Compromise is a huge mistake!
Having a Pro gives you an advantage
The IRS is more likely to accept, with less questions, a Certified Tax Resolution Specialist submission, whereas with an individual the red flag is already up.
Remember, you MUST be in compliance to submit an Offer in Compromise
In order for the IRS to accept an Offer in Compromise for submission, ALL required tax returns must be filed.