An “Offer in Compromise” (OIC) is an agreement with the IRS. It allows taxpayers to settle their tax debt for a lower amount. You might need this letter if you can’t pay your full tax liability. This often happens due to financial hardship.
Writing an OIC letter can be tricky. That’s why we’re here. We’ll provide sample letters. These are templates and examples. They will guide you through the process.
Our goal is to make it easier for you. We want to help you craft your own letter. We have different scenarios covered. Let’s get started.
Sample Letter To Irs For Offer In Compromise
[Your Name]
[Your Address]
[Your City, State, Zip Code]
[Your Phone Number]
[Your Email Address]
[Date]
Internal Revenue Service
[IRS Address]
[IRS City, State, Zip Code]
**Subject: Offer in Compromise – [Your Name] – [Your Social Security Number]**
Dear Internal Revenue Service,
This letter is to formally submit an Offer in Compromise (OIC) to resolve my outstanding tax liability.
I am offering to pay the IRS $[Amount of Offer] in full settlement of my tax debt for the tax years [List Tax Years].
I believe this offer represents the most the IRS can expect to collect from me, considering my current financial situation. I have enclosed Form 656, Offer in Compromise, along with all required supporting documentation, including:
* Form 433-A (OIC for Wage Earners and Self-Employed Individuals) or Form 433-B (OIC for Businesses)
* Proof of income (pay stubs, etc.)
* Bank statements
* Asset valuations (if applicable)
I understand that the IRS will thoroughly review my financial situation to determine if this offer is acceptable. I am committed to cooperating fully with the IRS during this review process.
I respectfully request that you consider my offer and grant me the opportunity to resolve my tax obligations.
Thank you for your time and consideration.
Sincerely,
[Your Signature]
[Your Typed Name]
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How to Write Letter To Irs For Offer In Compromise
Subject Line: Clarity is Paramount
- A succinct subject line enables the IRS to quickly categorize your correspondence.
- Employ phrasing like: “Offer in Compromise – [Your Name] – [Tax Year(s)] – [Tax ID or SSN]”.
- Avoid ambiguity; precision is your ally.
Salutation: Professional Courtesies
- Never initiate with generic terms like “To Whom It May Concern.”
- Strive to address a specific individual if feasible. Research the relevant IRS department or agent assigned to your case.
- If a name is elusive, “Dear Internal Revenue Service” is an acceptable alternative.
Introduction: Setting the Stage
- Begin by forthrightly stating the purpose of your missive.
- Example: “This letter constitutes a formal Offer in Compromise (OIC) application, seeking to resolve outstanding tax liabilities for the [Tax Year(s)].”
- Reference your case number, if applicable, to expedite processing.
Body Paragraph 1: Delving into Hardship
- Articulate the specific financial exigencies that preclude you from satisfying your tax obligation in full.
- Detail your income, assets, expenses, and any extenuating circumstances such as medical conditions, job loss, or family responsibilities.
- Be forthcoming, yet concise; avoid superfluous details.
Body Paragraph 2: Proposing Your Offer
- Explicitly state the compromise amount you are proffering.
- Provide a substantiated rationale for this figure, demonstrating how it reflects your ability to pay.
- Outline your proposed payment schedule. Will it be a lump-sum remittance or installment payments?
Substantiating Documentation: Fortifying Your Claim
- Create a comprehensive inventory of all supporting documents appended to your letter.
- This could include bank statements, pay stubs, medical records, and appraisals.
- Organize these documents logically and reference them explicitly within your letter.
Closing: Expressing Gratitude and Compliance
- Reiterate your commitment to fulfilling all future tax obligations.
- Express gratitude for the IRS’s consideration of your offer.
- Conclude with a respectful closing such as “Sincerely” or “Respectfully,” followed by your signature and printed name.
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Frequently Asked Questions: Offer in Compromise Sample Letter
Navigating the Offer in Compromise (OIC) process with the IRS can be complex. This FAQ section addresses common inquiries regarding sample letters to assist you in preparing your OIC submission.
1. What is the purpose of a sample letter when submitting an Offer in Compromise?
A sample letter provides a structured format and recommended language to ensure all necessary information is included in your OIC submission to the IRS.
2. Where can I find a reliable sample letter for an Offer in Compromise?
The IRS website often provides guidance and examples. Additionally, tax professionals and reputable online resources can offer sample letters tailored to different OIC situations.
3. What key information should be included in my Offer in Compromise letter?
Your letter should clearly state your intention to submit an OIC, explain the reasons for your financial hardship, and detail the proposed payment amount you can afford.
4. Is it mandatory to use a specific template provided by the IRS for my OIC letter?
While the IRS doesn’t mandate a specific template, it’s crucial to include all required information outlined in Form 656-B, Offer in Compromise Booklet.
5. Can I modify a sample letter to fit my specific financial situation?
Yes, sample letters should be adapted to accurately reflect your individual circumstances and financial details. Tailor the language and information to your specific case.