There are three types of Offer in Compromise IRS offers, and all three allow you to settle for less if your offer is accepted. In this video, we’re going to talk about doubt as to liability Offers in Compromise.
What does that mean, doubt as to liability? It’s the type of offer that you file if there’s some good faith bona fide argument that you may not be liable for the tax in question.
For example, the classic example is, your name is John Smith, and they have actually assessed a different John Smith’s tax to you.
A real classic example that happens a lot is, when Junior and Senior have very similar names, obviously, John D. Smith, Jr. and John D. Smith, Sr., and sometimes they even have similar Social Security numbers. If Junior’s taxes are assessed to Senior, then he’s not liable for those and he may be a candidate for a doubt as to liability offer.
It’s important to note that if you haven’t received a notice of deficiency that has to come by law, certified mail, return receipt requested to your last known address, the last address on your last tax return. If you’ve gotten a notice of deficiency and you did not take advantage of asking to petition to the tax court, then a doubt as to liability offer is not right for you.
In a doubt as to liability offer, actually a person from the IRS’ exam division will take a look at your claim and determine whether or not you were liable for the tax in the first place. If it’s accepted, you may be able to settle for less.
Thanks for watching.