New York Offer in Compromise Lawyers

Offer in Compromise: A Solution to Your Tax Debt Problems

If you have received a tax bill that you cannot pay or do not think you owe, the New York State tax department offers an option called “offer in compromise.” This program allows taxpayers who are unable to pay their full tax bill to avoid undue economic hardship. An offer in compromise lawyer can help guide you through this process.

There are two types of offer in compromises available. The first type is for liabilities that are final and not subject to any administrative or judicial reviews. If the taxpayer has exhausted all appeal rights and failed to contest the assessment, collection activity such as levies, garnishments, and warrants may be initiated by the NY tax department. When deciding whether to accept an offer, they will consider the solvency of the taxpayer as well as whether collecting payment in full would result in undue economic hardship. Basic living expenses like healthcare bills, welfare payments, and family expenses will also be taken into account.

The second type of offer is for liabilities still under administrative review where collection activities cannot yet be undertaken by the NY state tax department. Taxpayers have a right to appeal these types of liabilities if there are doubts about them being accurate or fair assessments. Offers made on these types of liabilities will only be considered if there is doubt regarding liability accuracy or fairness.

New York Offer In Compromise Lawyers

An experienced New York Offer In Compromise Lawyer can help navigate both options above with ease while ensuring your best interests remain protected throughout every step along this journey towards financial freedom from debt!

How Long Will My Offer In Compromise Take To Complete?

The IRS’s offer-in-compromise program provides an excellent way for taxpayers struggling with debt problems related to taxes owed but finding it difficult financially due either lack income sources or other reasons beyond control such as medical emergencies etc., which make paying off debts impossible without causing undue hardships on themselves financially over time period required repayments. However, the process can be lengthy and complicated.

The first step in getting your offer in compromise accepted is to get it marked “processable” by the IRS. This means that you are not a debtor in an open bankruptcy, have submitted the application fee or form 656-a (income certification for offer-in-compromise application fee and payment), and have submitted either a 20% payment with the lump sum offer or signed Form 656-A if making short-term or deferred periodic payments. If the IRS believes that you are filing an offer-in-compromise just to delay collections, they will reject it outright.

Once deemed processable, your proposal will be sent to an IRS Offer In Compromise Examiner who will review all of your information and documents submitted during examination phase which takes about four-six weeks on average before receiving letter from examiner stating their contact info so as know when expect response back regarding status update etc., depending upon complexity involved within case itself.

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During this third step called Examination Phase where designated examiner goes through everything provided by taxpayer including income sources/assets owned determining reasonable collection potential over remaining period left until debt paid off full amount owed plus interest/penalties assessed against them at time assessment made originally; this could take anywhere between four-eight weeks depending upon complexity involved within case itself.

Legal Scenario: What Would You Do?

Scenario

You owe $47,000 in back taxes to New York State from underreported freelance income over three years. After losing your primary job and depleting your savings, you cannot afford the monthly installment plan NYS is demanding and collection notices are threatening wage garnishment.

Can I settle my New York State tax debt for less than what I owe, and what are my chances of the state accepting a reduced amount?

Attorney's Answer

Under New York Tax Law Section 171, the Department of Taxation and Finance has authority to accept an Offer in Compromise when a taxpayer demonstrates doubt as to collectibility or that full payment would cause undue economic hardship. To qualify, you must disclose all assets, income, and expenses on Form DTF-4, and the state will evaluate whether the offered amount represents the most they could reasonably collect from you. In cases of genuine financial hardship, we have successfully negotiated settlements for as little as 10-20 cents on the dollar, though each case depends on the taxpayer's specific financial picture. An experienced tax attorney can prepare a compelling financial analysis that maximizes your chances of acceptance while protecting you from garnishment during the review period.

This is general information only. Contact us for advice specific to your situation.

If rejected during fourth step called Agree/Disagree With Examiner Phase then options available include raising valid counterclaims with help attorney present evidence supporting claims made while also increasing original offer amount proposed earlier if possible given current financial situation faced by taxpayer; however, if accepted after rebuttal then likely five-eight months total processing time required before final decision reached regarding acceptance/rejection of initial proposal offered up front initially without any changes being made whatsoever!

Finally comes fifth step called Appeal Or No? If rejected again after going through entire process above mentioned steps one more time around then allowed appeal decision Office Appeals where officers may accept previously rejected offers based upon well-documented information provided by taxpayer; however, if no choice but to appeal then entire processing time required could take anywhere between 12-24 months total depending upon complexity involved within case itself.