Offer in Compromise

Step 6: Negotiation and Review

At this time, you have submitted an Offer in Compromise to the Internal Revenue Service (IRS) and are awaiting a response.

Here is what happens next:

1) Received by Examiner; 2) Review; 3) Pending/More information needed; 4) Accepted/Rejected/Returned

Your Offer Examiner will be using the information from your financial statements and application to determine your overall collectability. He or she will be comparing reported information to:

  • bank statements
  • payroll documents
  • asset values
  • income history
  • personal information
  • tax collection statues
  • payoff amounts
  • projected future income

…and more.

After the Examiner review

After the initial review is complete, your Offer in Compromise could be:

  • Rejected due to an explainable reason
  • Needing additional information
  • Provided a Counter offer
  • Recommended for acceptance

Work with the Examiner to provide all additional documents they request of you. This process is different for every person who submits an offer and depends on information you reported, information the IRS has on file, expenses claimed above national standards, and much more.

The IRS will argue that some expenses are now allowable, which could increase your offer amount. We recommend consulting with a Tax Pro to assist in this process. Learn more about Transaccts Tax Consulting services to assist in this process.

Process of approving an Offer in Compromise

If things go smoothly during the review process, the Offer Examiner will recommend your offer for acceptance. There are several tiers of approval depending on total tax liability and other factors.  Your offer may be amended (changed) by the offer examiner to reflect what they think is accurate. Although rare, might also agree with everything as reported on your financial statements and application.

More commonly, your Offer Examiner will request additional information from you that will be used to prove what was reported.

Offer Rejected vs Offer Returned

There is a difference between your OIC being rejected and your OIC being returned.

  • Returned OIC: you cannot appeal an offer that has been returned. Rather, you can make necessary changes and resubmit another offer.  The Offer Examiner will give reason as to why the offer was returned.
  • Rejected OIC: this counts as a strike against your record. However, you can appeal a rejected offer. Learn more about appeals or complete the appeals form.

Offer accepted by the IRS

Congratulations! You have successfully navigated the OIC Roadmap! The IRS confirmation letter will arrive in the mail stating the accepted offer terms.

You must continue to stay compliant!