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In cases where any offer in compromise appears to be a
viable solution to a tax delinquency, the Service
employee assigned the case will discuss the compromise
alternative with the taxpayer and, when necessary,
assist in preparing the required forms. The taxpayer
will be responsible for initiating the first specific
proposal for compromise.
The success of the offer in compromise program will be
assured only if the taxpayers make adequate compromise
proposals consistent with their ability to pay and the
Service makes prompt and reasonable decisions.
Taxpayers are expected to provide reasonable
documentation to verify their ability to pay. The
ultimate goal is a compromise which is in the best
interest of both the taxpayer and the Service.
Acceptance of an adequate offer will also result in
creating for the taxpayer an expectation of a fresh
start toward compliance with all future filing and
payment requirements. [Emphasis added.]
IRM sec. 5.8.7.6(5) and policy statement P-5-100, as applied
in this case, appear to be inconsistent regarding the “best
interest of the government”. IRM sec. 5.8.7.6(5) pertains to
rejecting offers if they are “not in the ‘best interest of the
government’, per policy statement P-5-100", while policy
statement P-5-100 describes the dollar amount of offers which are
in the “best interest” of the government and encourages such
compromises. The “goal” of the offer-in-compromise program,
according to policy statement P-5-100, is to collect what is
potentially collectible as early as possible, and the “ultimate
goal” is to find a compromise that is in the “best interest of
both the taxpayer and the Service.” Policy statement P-5-100
does not mention “egregious past non-compliance”. It instead
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Last modified: May 25, 2011