Struggling with IRS Tax Debt? Here’s How an Offer in Compromise May Help
Struggling with IRS Tax Debt? Here’s How an Offer in Compromise May Help
Owing the IRS can feel overwhelming—especially when the full amount seems impossible to repay. Penalties, interest, and aggressive collection efforts can quickly spiral into a financial crisis. But if you're struggling with tax debt, there's a possible solution that may offer relief: an Offer in Compromise (OIC).
An Offer in Compromise is a program offered by the IRS that allows qualifying taxpayers to settle their tax debt for less than the total amount owed. It’s not an automatic fix, but for those who meet the criteria, it can provide a much-needed path to financial stability. At The Pope Law Firm in Houston, we help individuals and business owners understand whether they qualify for this option—and guide them through every step of the process.
How Does an Offer in Compromise Work?
An OIC is based on the principle of “reasonable collection potential,” which means the IRS reviews your income, expenses, asset equity, and ability to pay. If it determines that you genuinely cannot pay your full tax bill, even over time, they may accept a reduced amount to settle the debt.
There are two payment options when submitting an offer: a lump sum cash offer, where a portion is paid up front and the balance within five months, or periodic payments, which are spread out over time. The application process is thorough and includes multiple forms, fees, and detailed financial documentation. Mistakes or missing information can delay or derail your application—which is why proper guidance can make a real difference.
What Happens if the IRS Rejects Your Offer?
If your offer is denied, don’t panic. You have the right to appeal the decision within 30 days using IRS Form 13711. This appeal lets you explain why the original offer should be accepted and submit any new documentation that supports your financial situation. Rejected offers can sometimes be overturned if additional evidence shows your inability to pay more than the proposed amount.
At The Pope Law Firm, we assist clients not just in submitting offers, but also in preparing strong appeals when necessary. We work closely with individuals to make sure their financial records are accurate and up to date—because what the IRS sees on paper can make all the difference in the outcome.
Why Acting Early Matters
The IRS has specific timelines and documentation requirements for an Offer in Compromise. Waiting too long can result in lost appeal rights or missed filing opportunities. If your wages are being garnished, or you’ve received letters about liens or levies, it’s critical to act before the situation escalates further.
Working with a law firm that has a deep understanding of the OIC process can help ensure your application is submitted correctly and reviewed fairly. From the initial consultation to final resolution, The Pope Law Firm is committed to helping clients pursue real tax relief.
Ready to See If You Qualify?
If tax debt is keeping you up at night, it’s time to explore your options. A successful Offer in Compromise can reduce your total debt and help you move forward with peace of mind.
