top of page


  • Daniel Rodriguez

Can You Negotiate Your Tax Debt with the IRS?

If you owe back taxes to the Internal Revenue Service (IRS), you will want to do everything that you can to eliminate that debt as soon as possible. If the IRS believes that you are not making a sincere attempt to manage your tax liability, you could end up with a lien on your property that will make it easier to seize your property if you continue to neglect your tax debt. If you or a family member need legal assistance negotiating tax debt with the IRS, contact an experienced Sacramento tax debt forgiveness attorney. We at the NewPoint Law Group, LLP understand how crushing tax debt can negatively impact your personal and professional life, and we are here for you. The NewPoint Law Group, LLP is here to explain whether you can negotiate your tax debt with the IRS.

How to Manage Your Tax Debt with the IRS

Knowing that you a large amount of money in back taxes to the IRS can be a stressful experience. Fortunately, there are some options that a taxpayer has to decrease the amount of debt that they owe. If you need to negotiate your tax debt with the IRS, you should consider the following options.

Offer in Compromise

An offer in compromise (OiC) is a negotiation with the IRS where a taxpayer tries to eliminate some of the debt owed to the IRS. For example, if you owe $50,000 in back taxes, an OiC negotiation may attempt to get that number down to $30,000 so that a taxpayer can have an easier time with their monthly payments. If you do not believe that you can pay off the total amount of back taxes owed to the IRS, the offer in compromise may be the option for you.

To determine whether a taxpayer has a financial hardship that would permit them to qualify for an offer in compromise, the IRS will look at the following factors:

  1. The income level of the taxpayer

  2. The likelihood that the taxpayer can pay off the total amount of their debt

  3. The monthly expenses and other debts the taxpayer must manage

  4. The assets owned by the taxpayer

The IRS often agrees to an offer in compromise if they have a genuine belief that the taxpayer can only pay a certain portion of their total tax debt.

OiC Application Process

To have the IRS consider your OiC, you must submit your petition using Form 433-A for individuals or Form 433-B for businesses. You also must pay a $186 application fee that is non-refundable, so you should ensure the information your application is correct.

It is important to note that the IRS may still take actions regarding your debt while your application is being evaluated. For example, the IRS could file a federal tax lien on the property that you own. If a tax lien is placed on your property, it means the IRS could levy your property if you continue to have delinquent tax debt. Other events that could happen when your application is pending include:

  1. The money paid for your application will be applied to your tax debt

  2. Collection activities for your debt may be postponed

  3. Payments for a current installment agreement can be halted

OiC Payment Options

If the IRS accepts your offer in compromise, you will have to select a payment option that works for you. There are two types of payment options that a taxpayer has: lump-sum cash payments or periodic payments.

A lump sum cash payment means that the debtor must pay at least 20 percent of the negotiated amount when submitting their application. If the application is accepted, the taxpayer must pay the rest of the debt in no more than five payments.

If the debtor selected periodic payments, they could make a small payment with their application. Once the application is accepted, the debtor can then make periodic payments until the debt is completely paid off.

There are some other options for managing your tax liability with the IRS. For example, if this is the first-time you owe back taxes to the IRS, you could be eligible for the IRS Fresh Start Initiative. The Fresh Start program is a debt forgiveness plan that could help taxpayers pay off their debt to the IRS.

Work with Our Experienced Roseville Tax Lawyers on Your Claim

If you owe back taxes to the IRS, you should consult with an experienced Roseville tax lawyer today. The tax lawyers at the NewPoint Law Group, LLP possess decades of combined legal experience, and we would be honored to use this knowledge to assist you in managing your tax liability. To schedule a confidential legal consultation to discuss your tax situation, contact the NewPoint Law Group, LLP at 1-800 358-0305, or contact us online.

Recent Posts

See All


Sacramento form background.jpg

Connect with an Attorney

Your business deserves a legal partner who understands your current needs and is equipped to evolve with you. NewPoint Law Group is ready to be that partner, ensuring that your legal foundation is as robust and forward-thinking at every milestone as your business itself.

Create, Grow, and Protect Your Business with NewPoint Law Group

bottom of page