People all over the world are struggling with debt in the current global financial climate. For most people these debts will be to do with credit cards and loans, or having over-extended on a mortgage. For a small number of people however, it will be large tax debts owing that are causing them trouble. And often these debts can be just as stressful and just as crippling, with the belief that there is nothing you can do when you face going under, simply because you are dealing with the IRS. To a certain extent this is true – the IRS expects its taxes to be paid. But it is worth bearing in mind that in some cases it is possible for a certain amount of leeway to be given, or even an exception to be made, and that tax debt can be reduced through something called an Offer in Compromise.
Such a deal is rare, but comes about when the IRS either thinks there will be little or no chance of you paying the full tax debt owed, or it is in dispute with you about your total tax liability and whether you owe what they think you owe. In certain of these cases the IRS is permitted, at its own discretion, to look at, consider and then accept your submission of what is known as an Offer in Compromise. The Offer in Compromise is essentially an offer that you will make to the IRS that suggests a figure you think you can pay that is less than the figure they are asking for. Unbelievable as it may sound, they will often be willing to accept such an offer because they will look on it in such a way that they are at least going to recoup a portion of the debt you owe. Without that Offer in Compromise you may go bankrupt or not be able to pay them any of the outstanding debts.
Continue reading Bringing Down the Burden of Tax Debt – Offers in Compromise