How long does IRS offer in compromise take?

In most cases, it takes about six months for the IRS to decide whether to accept or reject your transaction offer. However, if you have to challenge or appeal your decision, the process may take much longer. Processing times vary, but you can expect it to take at least six months for the IRS to decide whether to accept or reject your compromise offer (OIC). The process can take much longer if you have to challenge the examiner's findings or appeal your decision.

It usually takes six to nine months for the IRS to respond. Staff, funding and the time of year when the OIC is presented influence the decision-making process. If more than two months have passed, you should check with the IRS to see how the process progresses. It's common for the IRS to take up to six months to make a decision.

There are no set deadlines for determining how long it will take to complete an OCI. The OCI process can take more than a year, but the average is approximately six months. Many factors contribute to the amount of time the IRS will need to approve or reject an OCI. If accepted, your transaction offer (OIC) will take approximately 6 to 8 months.

If you no longer have the original Form 656, you can provide a new Form 656 with the same bid amount and the same terms as the original. We created the Wiztax system to allow anyone to start the process of solving their tax problems online and filing them without having to spend thousands of dollars on lawyers or tax resolution firms that cost a lot of money. If your offer is not accepted and you have not incurred any additional tax debt, your installment agreement with the IRS will be reinstated at no additional charge. The better, more complete and accurate your personal and financial information is, the faster the IRS can determine if it will accept a transaction offer.

You answer simple tax questions, then Wiztax calculates the amount of your transaction offer and complete all the IRS commitment offer forms you'll need to file. When an offer is not met, the IRS can collect or file a lawsuit to collect the full balance of the offer or an amount equal to the original tax debt minus any payment received under the terms of the offer. The Pledge Offer Program (OIC) is offered by the Internal Revenue Service (IRS) as part of its Fresh Start initiative. If you paid an application fee that was returned to you, you must return the application fee to us; any bid payment you paid with the original offer will apply to your new offer.

If you don't make the payment, the offer will be withdrawn and returned to you without the right to appeal. You must continue to file and pay all your taxes on time for the period indicated in the offer contract, including any collateral agreements signed as part of the accepted offer. If the IRS submits a request for more information, as it usually does, be sure to provide accurate information and do so immediately. If only one check is received, the IRS will apply the application fee first and then apply the rest to the required payment amount.

As long as 2 years have elapsed since you submit your offer, the IRS will not automatically grant you an agreement while you take one of these steps. If you send MORE than the required amount AND designate the payment as a deposit on Form 656, Pledge Offer, any payment that exceeds the required amount is refundable. If the IRS determines that the rules would not cover basic living expenses in a particular case, deviations are allowed. The process is quite complex and a tax professional can greatly increase your chances of accepting an offer.

Brock Cottew
Brock Cottew

Infuriatingly humble web expert. Typical pizza fanatic. Lifelong food lover. Amateur bacon fan. Wannabe internetaholic.