No Way to Pay: Every day, hundreds of thousands of American Taxpayers discover that they are in debt. The rest of us spend our time hoping it’s not going to be us that owe. But if you’re in a situation where you owe the IRS thousands in back taxes, and you know you won’t be able to pay it, you might qualify for an Offer In Compromise.

What is an Offer? The Offer and Compromise (OIC) Program was designed by the IRS to give people who can’t pay their debt, a chance to make amends. You may have heard of the Offer Program described as settling for “Pennies on the Dollar.” It’s a little more complicated than that. But in the event that you really have no way to pay the debt, the IRS will compromise and take a smaller amount in lieu of the actual debt. But how can you qualify? How often does this happen?

How do I Qualify? The IRS has a basic formula. They basically calculate your finances and see if you could ever pay off the debt. Remember, when they are deciding this, assets are taken into account. In a nutshell, they are calculating your entire financial worth and seeing if it is equal to or more than the amount you owe. If it is, they will reject the offer. But if it is less, they will see that you obviously could not pay the debt, and will accept a smaller amount.

The Statistics: As of 2008, more than 83% of Offer in Compromise cases are rejected by the IRS. The biggest reason that happens is because that the people submitting the cases don’t know what they are doing. Most of those “Pennies on the Dollar” companies just collect your paperwork and submit it for an offer, even though they know it’s going to be rejected. Before getting a tax resolution company to submit an Offer for you, ask them about their OIC success rate.

Get Started Now: An IRS tax debt is not a laughing matter. It’s a major issue and it’s not going to go away. You need to deal with the issue as soon as possible. Even if you don’t think you qualify for an Offer, call a tax professional and find out the best solution for your particular issue.