VIDEO TRANSCRIPTION – What is an offering in compromise? Hi, I’m Steven E. Cooper, also known as Coach Coop with Cooper’s Accounting Service, because you’re financial freedom matters
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We actually had a married couple that came into our office and they wanted to know more about exactly what is an offer in compromise. An offer compromise is an agreement between the taxpayer and the tax authority, such as the IRS or the tax state agency as well to settle a debt for less than what you currently owe.
Another nugget within this, not all states offer an offering compromise. For example, the state of California does not offer an offering compromise. In this video, I’m gonna tell you the requirements of submitting the application
Number one, filing requirements. All of your tax returns must be submitted and filed. Current payments, for example, if you have estimated tax payments, all of your estimated tax payments ⁓ must be submitted to the IRS. In this example you cannot have an active bankruptcy at all.
Financial disclosure, in completing the application, which is form 656, there are other potential forms that you may have to fill out as an individual. That form is called 433F. As a business owner, businesses can also file for offering compromise as well. That form is called 433B.
Application, when you submit the application, you must pay the application fee and you must put in a good faith deposit. A good faith deposit could be estimated between 10 to 20 percent.
For more easy financial tips, sign up for our financial tip newsletter by going to yourfinancialfreedommatters.com or click on the link below this video. You can also download our financial guide as well. If you’d like a free 20 minute smart money consultation, call us at 562-436-2600. Well again, I’m Steven D. Cooper also known as Coach Coop with Coopers Accounting Service. Don’t miss our next video that we will cover. How do you qualify for offering compromise? See you next video.
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