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Offer in Compromise CPA discusses 2012 IRS changes to Form 656

Offer in Compromise CPA Wilmington NC discusses 2012 changes to Form 656

Gary Bode, CPA: the IRS offers a lower threshold to qualify for an Offer in Compromise. For a free phone consult call (910) 399-2705.

Through Form 656, taxpayers can pitch an Offer in Compromise to the IRS to pay less tax than actually owed. The Offer in Compromise is the infamous technique that used to saturate late night TV ads, promising to force the IRS to accept “pennies on the dollar.” Subsequently the IRS tightened the qualifications secondary to public outcry. However, it remains a valuable technique and I think most tax CPAs consider it a weapon in their arsenal. And qualifying is easier now for some “distressed” taxpayers.

The IRS uses financial analysis to qualify taxpayers for an Offer in Compromise. Recent changes better reflect a recession economy by reducing the time frame of future potential income used for financial analysis. Plus the standard living allowance now allows some credit card debt and student loans. Ask your CPA about these changes in Form 656.

The IRS increased the flexibility of Offer in Compromise payments as part of their Fresh Start initiative, which includes penalty abatement and streamlined Installment Agreements. The IRS states an Offer in Compromise could resolve some taxpayer’s problems in two years as opposed to 4-5 years.

I’m an Offer in Compromise CPA with a virtual office to accommodate clients outside my Wilmington NC geographical base. Fewer folks qualify for an Offer in Compromise than the public perceives. State governments have restricted abuses by Offer in Compromise national chains. It doesn’t really cost much to determine if you qualify. If you don’t have a local Offer in Compromise CPA, consider giving me a call for a free phone consult at (910) 399-2705.

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