Skip to main content

IRS says we still owe after offer of compromise was accepted and signed.

Tampa, FL |

Our OIC from the IRS was accepted in December 2011 and a lien was removed. We owed back taxes for 5 years, clearly listed on all OIC paperwork. The only stipulation was that we pay any owed taxes in full and on time for five years. We have the certified receipt showing it was received as such this year. Yesterday we received a notice from the IRS that we owe over $40,000 for two of the years that were listed as paid on the OIC. This makes no sense because it is the amount we owned for all 5 years before we filed the OIC. My husband was on the phone with the IRS for over two hours before he gave up trying to talk to someone who could help. One woman was very rude and said "you probably owe it." If this is true they are NOT honoring the OIC, what do we do if they insist we owe it?

Attorney Answers 2

  1. It's difficult to do things by phone because there's literally no "paper trail." That's why lawyers use letters, and insist on getting things in writing so they know who represented what and who's accountable for their representations.

    The IRS, like everyone else, makes mistakes. You've for your signed compromise, so you just need to enforce it effectively. Send them a copy of it, along with your certified copies of your payments to the address on the notice you got. Use certified mail (or FedEx) so you can prove their receipt.

    Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to any follow-up comments. If you want to hire me, please contact me. Otherwise, please don't expect a further response. We need an actual written agreement to form an attorney-client relationship. I'm only licensed in CA and you shouldn't rely on this answer, since each state has different laws, each situation is fact specific, and it's impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.

  2. The OIC being received is not the same as it being accepted. But it is almost impossible to tell what happened for sure. The OIC might not have included all the years of liability. There might have been a default on the payment, which could be a mistake or not. You should contact a professional in your area to look at your situation. Assuming that the IRS is just not honoring the OIC is likely a mistake. There might be a valid reason for it, and there might be a mistake by the IRS.

    Christopher Larson
    Insight Law