What happens if my Offer in Compromise is rejected?
Before you submitted your Offer in Compromise (OIC) you most likely were in the collections process. During that period of time your OIC application was pending, the Statutes of Limitations is suspended (Tolled) until a decision is made. Also, during that time, any enforced collection actions are also suspended.
If your OIC is rejected, typically, thirty days after the decision date of the offer unit, the case will be transferred back to collections, unless you file for an Appeal (see below). The case will either be assigned to Automated Collection Services (ACS) or in queue to be assigned to a Revenue Officer (RO). If you begin to receive notices right away, you have likely been assigned to ACS and they will restart the series of notices to reinstate the collection process. If there is a delay in the receipt of the notices, you may have been placed in queue to be assigned to a Revenue Officer, which is not a good thing!
What’s Critical?
It’s absolutely critical within that thirty days you file for an appeal by responding to the original Offer Examiners rejection. Doing so will cause your Offer to remain in the system and be forwarded to Appeals for reconsideration. This will prevent you from having to re-submit a new OIC.
When Should You File an Appeal Regarding the OIC Decision?
The IRS often rejects an OIC, in my opinion, for invalid reasons. We win a high percentage of our OIC’s in Appeals. If you filed your offer yourself, you want to make sure you are appealing for valid reasons. You can also appeal to suggest other resolution options and to delay your case going back to collections. I would not suggest appealing for the mere purpose of delaying the case being moved back to collections.
Resubmitting the OIC.
Only resubmit an OIC is if it is significantly different than the previous submission. The IRS indicates the most common reason for an OIC rejection is because the application was not prepared properly. If you are considering resubmitting an OIC you should use a Certified Tax Resolution Specialist, so the same mistakes are not repeated. It is considerably more difficult to get a second submission approved after a failed previous attempt. Note: The IRS will not approve a resubmitted OIC if it feels the OIC is frivolous or you’re trying to delay the collections process.
What happens if my Offer in Compromise is rejected?
My opinion it’s time to seek out a Certified Tax Resolution Specialist. Someone who can look at your financial circumstances and determine your best resolution option(s). Once the options have been reviewed, the specialist can help you implement the best option for your circumstances. Doing nothing or giving up is the worst thing you can do. As part of the Offer in Compromise application you must disclose all your financial information. The IRS views the best opportunity to collect the most from you when the thirty-day appeals window is shut. That is when some Agents become the most aggressive.
Review
The best thing I can suggest if you think your OIC could be rejected or has been rejected is to have a discussion with one of our Certified Tax Resolution Specialists to discuss your options.
Let’s schedule a call to discuss your options! To avoid the back and forth emails and phone tag, I have set up a link to my Calendar https://calendly.com/taxman/tax-problem-resolution-initial-consultation. Let’s set up a 30 minute. phone conference to get to know each other. The phone number to call is 855-829-5877 and my extension is 203.