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Washington Tax Services has been assisting individual taxpayers and small businesses with their past due tax troubles since 1989.  Whether you have been dealing with the IRS for years and can't get caught up, or are just now falling behind and don't know where to begin - We know the tax collection system and have the experience and expertise to get you the best results possible under the law. 

For millions of Americans, the Offer in Compromise will be the most effective method for seriously reducing IRS debt.  If you qualify you will only be required to pay a small fraction of what you currently owe to settle your back taxes for good.  Before attempting to submit an Offer however, it is important that you understand how the Offer in Compromise program works. 

As per section 7122 of the IRS Code, the IRS is willing to accept a reduced amount from a taxpayer as full settlement of a debt if the amount offered "reasonably reflects the collection potential."  Contrary to popular belief, the IRS does not enjoy going through collections procedures - it costs them a lot of money and effort to pursue people who owe back taxes, continually hounding them to pay. It's difficult for them, and stressful for the taxpayer.  So, for the many people who simply cannot afford to pay off their tax debts in full without experiencing a financial hardship, the IRS has determined that it is more cost effective (and politically favorable) for them to accept a discounted settlement now, rather than continue to use their limited resources to try to collect from someone who will probably never have the money to pay in full anyway. Understand however, that the Offer in Compromise is neither a giveaway nor an amnesty program. Accepting your settlement is essentially a business decision on the part of the IRS. You must PROVE to them that you qualify, plus offer them the appropriate "collection potential" to their satisfaction if you are to have your settlement accepted.

It is also important to realize that the Offer in Compromise is NOT a negotiation. The IRS has designed a complex series of formulas that reflect what they could legally collect from you over the next several years, and it is this amount that should be offered to the IRS. These formulas are sensitive to numerous factors, including income, assets, personal circumstances and the cost-of-living in the region where you reside. Therefore, every aspect of your financial situation must be examined before it is possible to determine an acceptable Offer for settlement. For example, overlooking an allowable monthly expense of as little as $100 can increase your Offer amount by as much $5,000. To be successful with this program, you must be aware of the IRS guidelines in order to take advantage of all the options the law provides.

The IRS also uses this program to encourage future compliance. When they accept your Offer in Compromise, you must sign a firm contract, the basic terms of which state that the IRS is willing to forgive your entire tax debt so long as you pay them the amount of your settlement Offer AND agree to file and pay your future taxes on time for at least the next five years. The great part about this is that, once your Offer in Compromise is signed and accepted, the IRS cannot come back and change your payments or charge you additional interest or penalties for the tax years you settled on.

After you submit your Offer in Compromise, it generally takes the IRS six to nine months to process, investigate and accept it. This will give you time to put together the money to pay your settlement if you don't yet have it.  Recently, the IRS has begun accepting installment plans on Offer in Compromise settlements, so you will not necessarily need to come up with all of the money at once.

Upon acceptance of your Offer, you will be given 90 days to pay, unless an installment plan is arranged. Once your Offer in Compromise is paid to the IRS in full, you will be absolved of your entire tax debt permanently, and all Federal Tax Liens held against your name, credit, and property will be released. All you will have to do from there is stay current on your taxes and payments for the next five years and hopefully you will never have to worry about an IRS tax debt again.

The process of submitting an Offer in Compromise will be fairly easy for you if you use our services.  When you call, you will be greeted by a Tax Consultant who will walk you through a brief financial interview and answer any questions you may have about the various programs available for Tax Resolution. We then use the information you share with us to determine whether or not you qualify for the Offer in Compromise and to estimate an acceptable Offer amount based on your particular circumstances. 

Should you decide to hire us, we will send you our proprietary questionnaire, which asks for information similar to what was covered in the initial interview, only in greater detail. Once we've received this back from you, we will perform an in-depth analysis of your tax situation and complete all of the paperwork required by the IRS to properly submit an Offer in Compromise.  If necessary, we will also complete all of the additional paperwork required to suspend IRS Collections on your case. When everything is complete, it will be sent to you to review, sign and send off. The package will arrive at your door ready to be forwarded to the IRS - the only thing required of you will be your signature.  

Washington Tax Services has been preparing Offers in Compromise for over 10 years; we are the best in the business at making sure you obtain the lowest settlement, and it is our promise to work diligently on your behalf to see to it that your tax liability gets the best resolution possible under IRS guidelines.