Procedure After Denial of Offer in Compromise

When an Offer in Compromise is denied, one has several options to proceed.  If the Offer Specialist is correct and the Offer cannot stand, one can simply abandon the Offer process and negotiate an Installment Agreement to full-pay the tax.

 

 

However, if the taxpayer thinks the Revenue Officer is wrong on one or more points of disagreement, he can appeal the denial to the administrative appeals division.  This appeal must be filed within 30 days of the date on the rejection letter.  There is no cost to file an appeal.  In the appeal the taxpayer must state why the revenue officer is wrong and provide new documentation to support his claim.  This is the better way to proceed after a rejection of an Offer if one meets the criteria.

If not, one can always file a new Offer.  There is no restriction on filing multiple Offers, except that the IRS will deny it immediately if it is determined that the Offer was submitted only for the purpose of delaying collection.  When the Offer is filed, a new filing fee of $150.00 is due as well as the initial payment on the Offer.  It is usually better to wait at least 2 to 3 months so that the taxpayer can establish some change in condition that makes the new Offer viable.