In this video, I wanted to talk about something called an Offer in Compromise, but more specifically,I want you to know that Offer in Compromise help is available.
This type of offer, there’s actually three types of offers. But in this type of offer, this is actually the most common. This is what people think of when they’re up late at night and they see TV commercials about you might be able to settle for pennies on the dollar.
I’m not allowed to say that, but basically, a doubt as to collectibility offer takes into consideration your hypothetical ability to pay and then the IRS calculates how much that they’re willing to accept from you.
It’s actually a mathematical calculation and it goes something like this. Monthly disposable income times 12 plus the value of your assets equals the amount of your offer. Now that’s kind of hard to understand unless somebody puts some numbers in there, so I’m going to go ahead and do that for you.
Let’s say you had $50 a month in monthly disposable income. According to the IRS, using their standards, they have standards for every county in the country based on how much your maximum housing allowance is for your family size and how much you’re allowed to spend on transportation and your car payment and so on.
But once the IRS calculates your monthly disposable income, let’s assume it’s $50. $50 times 12 is $600. Let’s say you have $1,000 in assets that are not otherwise exempt from this calculation. That would mean that your offer amount was $1,600.
Now, it’s really important to note that there’s a $150 filing fee for this type of offer and you have to make a 20 percent down payment before you can actually file your Offer in Compromise based on doubt as to collectibility.
Right now, they’re taking anywhere from three to six months to process, but the IRS has, by statute, up to two years. Interestingly enough, if the IRS does not accept or reject your offer within two years, it’s deemed accepted and you hit the lottery.
Thanks for visiting my page, I really appreciate it. Remember, Offer in Compromise help is just a phone call away if you need it.