Colorado Springs: What Can I Do If I Disagree With the Amount the IRS Says I Owe?

 

You receive an IRS notice saying you owe a large sum.  But, you disagree with the assessment, because there is a legitimate question about the correctness of the assessed tax amount.  What you can do is file a "Doubt as to Liability" Offer in Compromise.

Is this the correction option for your case?  Possibly it is, possibly it is not.  You need to consult with a tax professional, such as an Enrolled Agent (EA) because there are pros and cons to this type of offer. 

Some of the pros are:

• Collections stops
• Forces audit reconsideration
• Can reopen Trust Fund Recovery Penalty Assessment
  

Some of the cons are:

• Must offer something (even if it is a $1)
• Compromises future liability (no refunds)
• Taxpayer must be compliant

Remember, this option is designed for taxpayers who genuinely dispute the accuracy or existence of their tax debt. This could be due to errors in the IRS's calculations, misinterpretation of tax laws, or missing information that could alter the liability. Importantly, this type of offer cannot be rejected simply because the IRS cannot locate your return or verify the liability.

To qualify, you must present a compelling case that reflects what the IRS might reasonably expect to collect if the matter were taken to court. This involves providing substantial evidence and documentation to support your claim. The IRS uses its discretion to determine whether your offer is reasonable, considering the potential outcomes of a court case.

If you believe there is a genuine error in your tax assessment, submitting an OIC based on Doubt as to Liability could be a viable path to resolving your tax issues.
For more detailed information consult with an EA, who specializes in tax resolution to ensure your offer is well-prepared and stands the best chance of acceptance.

Cash Tracks Financial of Colorado Springs

Marcelino Dodge, EA, CTRC

525 N Cascade Ave., Suite 200

Colorado Springs, CO 80903

(719) 359-8789

www.cashtracksfinancial.com

success@cashtracksfinancial.com