Offer In Compromise: Review

The OIC program allows qualifying taxpayers to settle their tax liability in full for an amount less the full liability owed.  Recently, the IRS has changed some of its computational rules, which may make the program more accessible and attractive.

In particular, the new administrative rules for this program may provide more access to those who did not previously qualify for an OIC due to IRS computations of future income and equity in assets. Potential benefactors of these relaxed rules include:

  • Business clients
  • Clients with state tax liabilities and/or student loan payments
  • Clients who have been rejected for an OIC in the past due to future income calculations or unfavorable dissipated asset determinations

OIC computation is based on the reasonable collection potential of the taxpayer. If the taxpayer can pay before the collection statute of limitation expires, the taxpayer will not qualify for an offer in compromise. Reasonable collection potential is made up of two components:

  • The taxpayer’s monthly disposable future income (computed according to IRS future income rules and allowable living expense limitations) times the number of months remaining in the collection statute of limitations, plus
  • The net equity in assets (including any assets that have been dissipated since the tax liability was incurred and not used to pay necessary living expenses of the taxpayer)

The changes that the IRS recently announced modified the future income multiplier for computing the offer amount, allowed some expenses that were not previously allowed and clarified the rules to provide some relief to business taxpayers.

At Lefstein-Suchoff CPA & Associates, we have an excellent trac record for getting Offer In Compromise engagements accepted.  These discounted tax settlements allow people a second chance, please contact us if you need any help with an Offer In Compromise.

For help with IRS, tax audits, tax problems, back taxes, tax settlements, tax debt, Offer in Compromise, tax help, IRS debt, a tax lien, a state tax levy, an IRS levy, an IRS tax lien, contact us.  If you need IRS help and have unresolved cases with previous tax lawyers and tax attorneys, we can help find an optimal resolution for your indigenous needs.  Contact us at 201-947-8081 or 646-688-2807, or email us at


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