Offer in Compromise versus Partial Payment Installment Agreements for back IRS taxes-personal and business taxes
Today I was able to negotiate a partial payment installment agreement for a couple that owes over $140,000 in back civil penalty taxes (a trust fund taxed assessed against them for an old corporation which owed back payroll taxes) for $252 a month over the next four years (the time remaining on the collection statue). The couple makes decent money, over $7200 per month which makes this a pretty decent deal for my clients. Although this is not considered technically an Offer in Compromise , it does allow the taxpayer to "settle" for paying approximately $12,000 on over $140,000 of tax debt, a whopping savings of over 91.5% of the total tax debt (when you consider IRS interest which is compounded daily on the civil penalty taxes-personal income tax debt also accrues penalties, but the trust fund recovery penalty in itself is a penalty so only interests accrues on the account). Now if my client comes up with around $12,000 or even a little less (by borrowing from friends