P>Dean Michael, the Tax Doctor, is here to provide tax help in MD. Today, I want to discuss the Offer in Compromise, also known as the Fresh Start Program. You may have seen it advertised on TV or heard it on the radio, all promising to settle your tax debt for pennies on the dollar. However, what they fail to mention is that there is a specific equation used to determine the offer amount. It's not as simple as saying, "I owe this amount, so I'll offer them that amount and hope they accept." It's not a wish and a prayer type of program. Instead, it's based on your monthly Net Disposable Income (NDI). Net Disposable Income refers to the amount left over after paying all your bills each month. This includes expenses for food, clothing, housing, transportation, and medical costs. The IRS doesn't consider other expenses such as credit card bills, old medical bills, or private school tuition. In this equation, we'll only focus on your monthly NDI. Let's take an example to better understand this equation. We have a gentleman who owes $10,000 to the IRS. His monthly income is $3,000, and his total expenses amount to $2,800. Therefore, his monthly NDI is $200. When making an offer to the IRS, there are two types to consider: a lump sum offer and a 24-month installment agreement offer. Each type has a different equation. For a lump sum offer, where you pay the offered amount to the IRS within 90 days of acceptance, the equation is as follows: Multiply the monthly NDI ($200 in this case) by 48 months. If there are any asset values, such as home equity, those are added as well. In this example, the gentleman doesn't have a home, so the offer amount would be $9,600. This...
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Irs 656 B Offer In Compromise Form: What You Should Know
This is the same form you used to calculate and report an amount for an IRS tax debt.) If you are unsure of the liability status of your business, call the IRS at on a Saturday or Sunday (excluding IRS tax day) to speak to a Special Representative. If you are requesting information on Form 656-L, you must complete an IRS form () and then mail. You may also write to: U.S. Department of the Treasury, Bureau of the Fiscal Service, Internal Revenue Service, P.O. Box 17280, St. Louis, MO 63, U.S.A. This Form 656-L is a one-time letter to the business. It does not give you the opportunity to respond to any additional requests you have. It will not allow you to settle or adjust your tax debt. If you're the IRS and you are requesting information on Form 656-L from a taxpayer and the individual who signed an Individual Taxpayer Examination Report (INTER) with a notice of payment of tax due, or from another taxpayer who agrees in writing with your offer in compromise.
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