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The formula for determining if your client is likely to qualify for an offer in compromise...

The formula for determining if your client is likely to qualify for an offer in compromise is: Income less expenses equals balance owed. Net equity in assets + Monthly disposable income X months on CSED is less than the total balance owed.

Net assets are less than the balance owed. Annual income is less than the balance owed.

The formula for determining if your client is likely to qualify for an offer in compromise is: Income less expenses equals balance owed. Net equity in assets + Monthly disposable income X months on CSED is less than the total balance owed.

Net assets are less than the balance owed. Annual income is less than the balance owed.

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Answer #1

The Offer in Compromise is appropriate for people who can’t pay their taxes and want to settle for a payment that is less than the amount they owe.

The IRS will accept an Offer in Compromise only if taxpayers are in filing compliance, meaning they’ve filed all required past returns

The formula is simple: Can taxpayers pay the taxes they owe with their net equity in assets, plus any future disposable income (that could be paid monthly) before the collection statute of limitations expires? The IRS calls this “reasonable collection potential.”

The formula for determining if your client is likely to qualify for an offer in compromise is:

Net equity in assets + Monthly disposable income X months on CSED is less than the total balance owed.

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