Six to twelve months is a reasonable timeline for receiving a decision on your Offer in Compromise (OIC). However, some offers take longer to resolve, and the IRS has up to two years to give you a response.
If you don’t receive a decision from the IRS within two years, your Offer is deemed accepted.
Getting the OIC Accepted for Processing
Your first step is getting the OIC accepted for processing. The IRS can return your offer without even considering it if you fail to meet certain procedural requirements, such as:
- You failed to send in the application fee with your Offer
- You didn’t submit the required initial payment with your OIC
- You have unfiled tax returns for prior years
- You are in an open bankruptcy case
- The IRS thinks you are filing the OIC just to delay collection of the tax
If your application is accepted for processing, it will then be assigned to an IRS examiner. You’ll receive a letter in the mail with their contact information and they will begin the examination process.
The OIC Examination
The examiner’s job is too confirm all of your financial information and determine whether your offer meets IRS standards. If you haven’t offered at least as much as the IRS could get from you using enforced collection actions, such as levies and wage garnishments, then your offer will be rejected.
The length of the examination can vary widely depending on your situation. Eventually, the examiner will either accept or reject your offer. You’ll have to chance to negotiate with the examiner, dispute any of their findings, or increase your offer.
At this point, the process has usually been ongoing for a minimum of six months, but can take quite a bit longer if you have a complicated situation.
You have the right to appeal an OIC rejection to the IRS Office of Appeals. This may add a lot more time to your OIC case, resulting in a total processing time of one to two years.
Because OICs take so long to process, you should make sure you are submitting a realistic offer will of the correct information. Contact a tax attorney for assistance using the IRS Offer in Compromise program.
Get help with your Offer in Compromise by calling The Gartzman Law Firm at (770) 939-7710. We can listen to your concerns and help you find the best tax resolution strategy for your case.