IRS Offer in Compromise - Missed Payments

If taxpayers do not abide by all the terms of the agreement -- including filing all future returns and making all payments when required for 5 years or until the offered amount is paid in full, whichever is longer -- their OIC may be declared in default. If the IRS rejects the OIC, taxpayers will be notified by mail. In the IRS letter, it will explain the reason for the rejection and provide detailed instructions on how to appeal the decision.

Taxpayers may choose to pay the offer amount in a lump sum, in monthly payments over the remainder of the statutory time allowed for collection, or a combination of a lump sum and monthly payments. Generally, it is to the taxpayer’s advantage to pay the amount in the shortest time possible because longer payment terms will require a larger offer amount.

IRS Offer in Compromise - Missed Payments