Offer in Compromise
You Owe the IRS More Than You Could Ever Pay. There Is a Legal Way to Settle for Less.
An Offer in Compromise lets qualifying taxpayers settle their entire IRS debt for less — sometimes significantly less — than the full amount owed. The IRS accepts them when collecting more would create genuine financial hardship.
Does this match your situation?
- The IRS says you owe a number that feels impossible — $20,000, $80,000, $200,000 or more
- You've seen ads promising to "settle for pennies on the dollar" and you want to know if that's real
- A tax relief company told you that you qualify for an OIC — without reviewing a single financial document
- You're making payments but the interest and penalties are growing faster than your payments reduce the balance
- You genuinely cannot afford to pay what the IRS says you owe — not now, not in installments
- You've never heard of an OIC and want to know if it's actually an option for someone in your position
If any of those hit home, you're not alone — and there's a clear path forward.
Here's what happens to taxpayers who owe more than they can pay and do nothing
The IRS continues to add interest (currently 8% annually) and failure-to-pay penalties to your balance — compounding the debt every month
Collection action escalates: the IRS files liens, then levies bank accounts and wages, then seizes assets
The statute of limitations on IRS collection is 10 years — and the IRS uses all of it if you don't resolve
OIC eligibility narrows over time as your financial situation changes — windows to qualify can close
Unresolved IRS debt blocks passports, federal employment, professional licenses, and government contracts
How the Offer in Compromise Process Works With Luisa
Calculate Your Reasonable Collection Potential (RCP)
The IRS evaluates every OIC against your Reasonable Collection Potential — the maximum it believes it could collect from you. Luisa calculates your RCP accurately, using every allowable expense deduction to reach the lowest defensible number before any offer is submitted.
Prepare & Submit a Bulletproof Application
An OIC application is Form 656 with full financial disclosure, supporting documentation, and a detailed statement. Luisa prepares every page knowing how IRS Offer Examiners evaluate submissions — errors and omissions are the #1 reason offers get rejected.
Represent You Through IRS Review & Negotiation
The IRS reviews OIC applications for 6–12 months on average. During that time, Luisa responds to every IRS request, submits supplemental documentation, and negotiates directly with the Offer Examiner to maximize the chances of acceptance.
What Happens in Your IRS Debt Settlement Strategy Session
- Luisa reviews your income, expenses, assets, and IRS balance to calculate whether an OIC is realistically available to you
- She gives you an honest assessment — not a sales pitch. If you don't qualify, she tells you that and explains why
- If you do qualify, she explains the estimated offer amount, the application timeline, and what life looks like while the OIC is pending
- You leave knowing whether an OIC is the right path, and if so, exactly what the next steps are
Luisa N. Victoria, EA
Federally Authorized Enrolled Agent
All 50 States
IRS Debt Settlement Strategy Session
Includes: IRS transcript review, options analysis, and a clear action plan.
You May Qualify for an OIC If:
- Your monthly income barely covers your allowable living expenses, leaving little or nothing for the IRS
- Your total assets — home equity, retirement accounts, vehicles — are worth less than the full tax balance
- You have filed all required tax returns for the past several years
- You are not currently in an open bankruptcy proceeding
- You genuinely believe the tax amount the IRS says you owe may be wrong
Free Training
Not ready to book yet? Watch our free Offer in Compromise training first.
Frequently Asked Questions
What is the actual acceptance rate for Offers in Compromise?
The IRS accepts roughly 30–40% of OIC applications in a given year — but that number is misleading. Many applications are submitted by taxpayers who clearly don't qualify. When Luisa submits an offer, it's because the analysis supports it. Applications prepared correctly by qualified representatives have a significantly higher acceptance rate.
What happens to IRS collection while my OIC is being reviewed?
The IRS suspends most collection activity while a valid OIC is under consideration — and for 30 days after a rejection (in case you appeal). Levies generally cannot be issued during this window. The statute of limitations also pauses, so the IRS gets extra time — which is why you want the offer accepted, not just pending.
How much will my offer be?
The minimum offer the IRS will consider is your Reasonable Collection Potential (RCP) — which is based on your equity in assets plus your future income potential. In a genuine hardship case, this number can be a small fraction of the total balance. Luisa calculates your RCP in your strategy session.
What if the IRS rejects my offer?
You can appeal a rejected OIC to the IRS Office of Appeals within 30 days. Luisa handles the appeal and presents the case for why the offer should be accepted. If the appeal fails, other resolution paths — installment agreement, CNC status, or hardship — remain available.