Dealing with the IRS

[southernbelle1]

I'm in a situation where I owe almost $90k in withholding taxes from a failed business due to my ex's thievery. The IRS doesn't recognize Innocent Spouse Relief for business taxes and since I was listed as owner they of course want to collect from me (also I am an easier target and my ex has nothing and lives like a gypsy).

I have an Enrolled Agent helping me and he wants to file an OIC but since I make about $58k and have about 10 yrs left on the SOL, I really don't believe they will be willing to compromise. Also, I've heard tons of horror stories about the IRS's OIC scam in which they will gladly accept your 20% and can reject the offer for any reason including future collection potential or the compromise not being in the best interest of the government. Since I am not interested in extending the 10 yr SOL any longer while the IRS decides to deny my OIC, does it seem reasonable to request a partial payment installment agreement that will last the remainder of the SOL? I know by doing this I run the risk of having a huge monthly payment I can barely afford for the remainder of the SOL, but it might be easier than forking over thousands of dollars to end up in a payment agreement anyway.

Anyone have any experiences with OIC's and are willing to share their stories? Thanks for any help you can give.

[Bubba Jimmy]

since I was listed as owner they of course want to collect from me (also I am an easier target and my ex has nothing and lives like a gypsy).

Well, if you were the owner then you had a responsibility to turn over the taxes withheld from your employees to the IRS. Did you file a police report for the theft?

Anyone have any experiences with OIC's and are willing to share their stories? Thanks for any help you can give.

Yes. I do not handle them unless I believe there is a strong liklihood that the IRS will compromise. There are many people who advertise their services who make a business out of charging people to file OIC claims that have zero chance of being accepted. You are astute to beware of this kind of thing because you will be asked to pay for your representative's services in advance.

You are also correct in evaluating how the IRS will view your ability to pay. You have not said what the size of your family is but the IRS will determine your ability to pay based on that, your income, your assumed living expenses as defined by them, and your other resources. If they believe you can service the debt with a payment plan and that they will eventually collect then they will not compromise. You have a large number, and there is a possibility that the IRS would compromise with you but it is not likely to be "pennies on the dollar" but perhaps $.50 cents on the dollar on a long term payment plan. Just get more than one opinion before you pay anyone. I'd say at least three, and don't go to any of the firms that advertise nationally. None of them are likely to tell you that you have no chance of success.