Frequently Asked Questions

Q. I filed my tax returns but didn't have the money to pay what was owed. How do I reach a settlement to clear my back taxes?

A. When the Internal Revenue Service sends you a notice stating that you owe back taxes, the amount is usually much higher than what you thought because they have tacked on penalties and interest. Of course you could just write a check and pay them the full amount, including penalties and interest. Worse you could just ignore them; meanwhile the penalties and interest keep piling up. You could meet with the IRS and attempt to reach an agreement yourself, or you could hire a tax attorney who is experienced in the matters of back taxes. By analyzing your situation, we can determine your best course of action. For many taxpayers, this typically leads to an Offer in Compromise.

Q. What is an Offer in Compromise?

A. An Offer in Compromise is an agreement between the IRS and the taxpayer to settle the taxpayer's liability. The Internal Revenue Service has the authority to settle or compromise federal tax liabilities by accepting less than full payment under certain circumstances. These circumstances are:

• Doubt as to liability
• Doubt as to collectibility
• Effective tax administration (i.e., economic hardship)

Q.Even though I am making installment payments, can I do an Offer in Compromise?

A. Yes! And in some cases the installment agreement can be suspended while the IRS is evaluating the Offer in Compromise.

Q. When the Internal Revenue Service approves an Offer in Compromise, what happens next?

A. You may have up to ninety days to tender payment to the Internal Revenue Service of the offered amount. Once the IRS has received payment, they will release all tax liens and there is no further liability.

Q. How long does it take for an Offer in Compromise to be approved by the IRS?

A. Depending on the caseload in your district, it generally takes six to twelve months. But no matter how long it takes the Internal Revenue Service to review the Offer in Compromise, during that time all further collection activities are suspended.

Q. Will I have to see or speak to the Internal Revenue Service if you take my case?

A. No! We will handle your case in its entirety. All communications with the IRS will be made directly through us.

Q, Can I file bankruptcy and discharge my taxes without entering into an Offer in Compromise?

A. Generally personal income taxes that are at least three years old, and were assessed at least 240 days prior to bankruptcy filing, and voluntarily filed at least two years ago, can be discharged. The trust fund portion of employment taxes is not dischargeable in bankruptcy; therefore, an Offer In Compromise is the only way to effectively eliminate the burden of the trust fund portion of employment taxes.

Q. I have not filed returns for a number of years. Is it too late to reach a settlement and make a fresh start?

A. All tax returns must be filed to do either an Offer in Compromise or an Installment Agreement. We can work with your tax preparer to bring you current and formulate a strategy to pay off the balance due. For many taxpayers, this typically leads to an Offer in Compromise.

Q. Is an Offer in Compromise best for me?

A. That depends on your situation, which is different for each taxpayer. That is why we offer a free consultation to assess your needs and to recommend what would be best for you in your particular situation.

Q. When do I have to pay the amount being offered in an Offer in Compromise?

A. Upon receiving an approval letter from the Internal Revenue Service, you may then have as long as ninety additional days to pay the offered amount. No matter how long it takes the IRS to approve your Offer, the underlying offered amount remains fixed. There are no accruals of interest or penalties tacked on. After receiving payment, the IRS writes off the balance of the liability and releases all tax liens previously filed.

Q. Can the IRS ever revoke an approved and paid Offer in Compromise?

A. Your Offer will not be revoked as long as you comply with the requirements relating to filing returns and paying required taxes for the five years after the date your Offer is approved by the Internal Revenue Service.

Q. What are your fees?

A. Our fees for an Offer In Compromise are generally a flat rate and the terms of our engagement will be presented to you in writing for approval before we file any paperwork with the IRS.

Q. I am located outside South Florida . Can you still help me?

A. Yes! The IRS has offices all over the country and every office is subject to the same guidelines. With today's instant communication, mail, phones, facsimiles, and e-mail, it has become relatively easy to accommodate taxpayers who reside anywhere in the country.