Question:   I am unable to pay my delinquent taxes. Will the IRS accept an Offer in Compromise?

You may qualify for an Offer in Compromise if you are unable to pay your taxes in full or if you are facing economic hardship or other special circumstances.

Note:

Offer in Compromise Application Fee - Your offer must include the $150 application fee.  If you are requesting a low-income exception of the fee, you must complete section 4 of the Form 656, Offer in Compromise. 

Offers received without the $150 fee or a completed section 4 of the Form 656 will not be accepted for processing.  Please see Step Six on Page 4 of the Form 656-B, Offer in Compromise Booklet, for more information on the application fee and to determine if you qualify for the low-income exception.

•  If you are not granted an Offer-in-Compromise and you are still unable to pay your delinquent taxes, you still may be eligible for an installment agreement.  File Form 433-D, Installment Agreement, and pay a $105 user fee, which we have the authority to deduct from your first payment(s) ($52 for Direct Debit).
•  If you default on your installment agreement, you must pay a $45 reinstatement fee if we reinstate the agreement
•  Refer to Tax Topic 204, Offers in Compromise, for additional information.