Offer in Compromise Success Stories

Summary of Success Stories

• Albert Yuen - Houston, Texas - CPA - Saved a Half a Million on Payroll Taxes & Penalties
• John Ecton - Irmo, South Carolina - Attorney - Helped Client After National Companies Failed
• Steve Shapiro - Saint Charles, Missouri - CPA - $100 Settlement on Five-Figure Debt
• Stephen Weisberg - Southfield, Michigan - Attorney - Used taxpayer's Circumstances to Reduce the IRS's Offer to $100
• Ahlberg Auna - San Antonio, Texas - Enrolled Agent - Saved Client $80,000 on an $85,000 Tax Liability
• Peter Salinger - Jacksonville, Florida - Enrolled Agent - Saved client over $200,000 After First Offer Was Rejected
• Jason Wiggam - Atlanta, Georgia - Attorney - Reduced Tax Liability by 70% and Saved Taxpayer's Business
• Lucy Petry - Houston, Texas - Attorney - Settled $220,000 in IRS Debt for $9,000
• Morgan Anderson - Lakewood, Colorado - Enrolled Agent - Saved Client over $230K Just in Time for Her Wedding
• Martin Cantu - Round Rock, Texas - Enrolled Agent -  Settled Over $200K in Tax Debt for $100 Monthly Payments
• Tammy Graham - Logansport, Indiana - Enrolled Agent - Settle Tax Bill After a Debilitating Car Accident
• Steven Striffler - Quincy, Massachusetts - Attorney - Appealed the IRS's Original Offer to Save Client More Money
• James Cha - Los Angeles, California - CPA - Settled $69,700 in Tax Debt for $180
• Susan Puckett - Colorado Springs, Colorado - Enrolled Agent - Helped Family Settle a Large Tax Debt
• Bradford Simmons - Plymouth, Massachusetts - CPA - Helped Client with Unfiled Returns Save $237,000

Saving Over Half a Million on Payroll Taxes and Penalties 

Albert K. Yuen 

CPA and Certified Tax Resolution Specialist at Al Yuen, PLLC

Houston, Texas

We helped a taxpayer settle $630,000 in tax debt for just $16,100. 

The client owned an S-corp that owed $390,000 in payroll taxes, but the business had very few assets. The IRS officer proposed a much higher settlement, but through tough negotiations in the appeals process, we convinced the IRS to settle the debt for just $100. 

Additionally, due to the unpaid payroll taxes, the IRS assessed a Trust Fund Recovery Penalty of $240,000 against the client, and we convinced the IRS to settle that bill for $16,000. These two settlements allowed the client to save $613,900. 

Lesson learned: If you appeal aggressively and politely, you may get what you ask for from the IRS.

Helping a Client After the National Debt Relief Companies Failed

John A. Ecton
Tax Attorney at Ecton Law Firm, PA
Irmo, South Carolina

A pilot came to us after the IRS issued a Notice of Levy for $115,000 in unpaid back taxes. He had tried to work with a national tax debt relief company out of Florida, but they were unable to help him. 

When we dug into his tax account, we discovered that the client had never received a Final Notice of Intent to Levy because the letter went to an old address. The IRS can only levy your assets if they send this notice properly. Based on that, we negotiated a levy release and filed a Request for a Collection Due Process hearing to get his case in front of appeals. 

After a couple of rounds of negotiation, we were able to compromise the case for $6,798, saving the client over $108,000. 

Takeaway: A lot of clients come to us after the national resolution companies fail them. The reason: Tax problems are personal. We provide clients with personalized, customized solutions to ensure they get the best tax resolution possible. 

$100 Settlement on a Five-Figure Debt 

Steve Shapiro

Enrolled Agent at Steve Shapiro, EA, CTRC

Saint Charles, Missouri

A client asked if we would represent a convicted criminal who was having tax issues. Due to his criminal history, no one else wanted to represent him, but I said I would talk with him. 

I met with him and he told me a sad story about how he had committed a terrible offense, spent several years in jail, and lost his family, a well-paying job, and all of his lifetime friends. He hit rock bottom. He also had a substantial tax debt. And things weren't looking up.

We moved forward with the engagement, and after doing the financial calculations determined that he was a strong candidate for an Offer in Compromise. Tragically, just as we were about to submit the Offer, he was diagnosed with advanced-stage cancer.

After taking months to review the OIC application, the IRS accepted an Offer of $100.00 on a five-figure tax debt. Miraculously, he beat the cancer. He was forever grateful for the help and several years later, I still hear from him expressing his appreciation.

Using the Taxpayer's Circumstances to Reduce the IRS's Offer to $100

 Stephen A Weisberg

Tax Attorney With the W Tax Group

Southfield, Michigan

A couple in their early 60s owed $54,937 to the IRS due to distributions from the wife's retirement account. The wife had multiple expensive medical issues, the husband worked several part-time jobs on a sporadic basis, and they had no equity in their assets.

Based on their situation, I knew they would qualify for an Offer in Compromise. However, when we applied, the Offer Examiner determined that the couple should pay $26,000 due to the husband's income and his potential to continue earning the same amount of money in future years. 

We immediately appealed the determination. The appeals examiner originally agreed with the IRS. I drafted an in-depth and comprehensive argument, agreeing that the Offer should be $26,000 on technical grounds. However, I also provided multiple reasons why an Offer of $100 was more appropriate. I argued that the circumstances of the case, including the taxpayers' ages, the husband's sporadic income, and the wife's medical conditions, should lead to a lower Offer. 

Ultimately, we settled the client's $54,000+ tax bill for just $100.

Saving a Client $80,000 on an $85,000 Tax Liability

Ahlberg K. Auna

Enrolled Agent at Axtax, Inc.

San Antonio, Texas

The taxpayer engaged our services to review her installment payment plan and see whether she would qualify for an Offer in Compromise. She owed $85,000 in IRS taxes due to non-reporting of gambling winnings which were assessed by the IRS Automated Under Reporter (AUR) correspondence audit department. 

Our initial financial analysis determined that her reasonable collection potential was $20,000 based on her income and assets. However, she had limited sources of income (Social Security and a small pension) and growing medical expenses, and she couldn't afford to pay the $20,000 in a lump sum or as a short-term deferral plan spread over 24 months. 

To help her get back into good standing with the IRS, we advised her to file her annual tax returns. Then, due to her poor and declining health as well as financial hardship, we applied for an Offer in Compromise based on Effective Tax Administration. The IRS rejected our $1,300 Offer due to the equity in the client's home. 

We appealed the decision and argued that her home was worth much less than the IRS Examiner's number. The IRS was using values from Zillow and Trulia to estimate her home's value, and they were not taking its current condition into account. We advised the client to obtain a certified appraisal of her home, a realtor's assessment of its marketable value, and several contractor bids about the repairs needed. 

We again offered $1,300, and IRS Appeals countered and settled for $5,000. The process took nine months, but the client saved 94% of her tax bill. She borrowed the $5,000 from a trusted friend and cleared her balance within a month. 

Takeaway: When looking for tax resolution strategies, consider special circumstances that may work.

A Taxpayer Saved Over $200,000 After Their First Offer Was Rejected

Peter Salinger

Enrolled Agent at Salinger Tax Consultants

Jacksonville, Florida

A client who owed about a quarter of a million dollars came to us after the IRS rejected his initial Offer in Compromise application. He had previously worked with another attorney who submitted an Offer of $102,000, and the IRS rejected this Offer for being too low. 

After reviewing the rejection documentation, I decided to start from scratch with a new 433-A. Based on my background as an IRS employee with detailed OIC investigative experience, I thought about the case from the IRS's point of view, and I got ready to answer the examiner's questions. 

When dealing with Offers in Compromise, the IRS wants to collect the taxpayer's reasonable collection potential which includes all of their assets and a certain amount of future income. In this case, there wasn't any dispute about the equity in the taxpayer's real property or automobiles. Most of the collection potential came from the client's bank account balances and retirement account. However, his bank accounts had been dwindling due to medical bills, and the retirement account had lost value. 

The taxpayer would have been happy if I'd gotten the IRS to agree to the original $102,000 Offer, and if required, they were able to pay up to $150,000 if they borrowed money from family. However, after a close financial review, I determined that the reasonable collection potential was just $42,000. 

I prepared a letter for Appeals to outline my findings and make the case for a lower Offer. I also attached an asset-equity table and an income-expense table to support the argument. 

Appeals recommended accepting the Offer for $42,000. Due to the amount owed, IRS legal staff and Appeals upper management also reviewed the Offer, and they also agreed. 

Tip for Taxpayers: An Offer in Compromise is not an easy program, and it can take up to a year to get a response. If someone says you qualify for an Offer without doing a deep dive into your finances, stay away from them. Look for someone who has experience with this program and who will take the time to review your unique situation. 

Reducing a Tax Liability by 70% and Saving the Taxpayer's Business

Jason Wiggam

Tax Attorney at Wiggam Law

Atlanta, Georgia

Our client is a prominent artist who invested in a civil partnership. The partnership’s tax returns were audited, leaving our client owing nearly $600,000.00 in federal liabilities and almost $200,000.00 in liabilities to the state of Georgia.

Our client’s business was suffering an economic downturn, and the taxpayer was unable to pay the balance in full. We started by preventing the IRS and Georgia Department of Revenue from taking aggressive collection action against our client, who was facing a total of $788,908.71 in tax liabilities between the state and the IRS.

Our strategy was focused on making sure that our client’s art business could have a chance to bounce back from its decline while the client got a handle on their tax debt. With this goal in mind, we successfully negotiated an Offer in Compromise with the state and IRS.

For the IRS compromise, we were able to establish an Offer of $117,556.00, resulting in a tax savings of over $477,201.00. The plan we negotiated with the IRS allowed the client to make monthly payments on the settled amount while his business continued to grow.

On the Georgia side of the case, we were able to negotiate an Offer with the Georgia Department of Revenue for $115,465.00, resulting in $78,684.00 in savings. We were also able to achieve a plan to allow the taxpayer to make monthly payments on the state liability as well.

With both Offer-in-Compromise negotiations, we were able to save our client $555,885.00 of their original combined liability total of 788,906.71. Our team’s efforts resulted in a 70% savings and allowed our client to have a fresh start without sacrificing their art business. Because the tax liability was more manageable with the negotiated monthly payments, our client has since paid all of the settled tax debt.

Key Takeaway: At Wiggam Law, we know facing a large tax bill can be stressful, especially when you owe both IRS and state tax debts. If you’re struggling with a mountain of tax debt, an Offer in Compromise might be a good option for you to eliminate a percentage of your debt so you can start fresh and move on with your life without the burden of back taxes.

If you believe you may qualify for an Offer in Compromise, you can go through the process yourself, but they don’t make it easy for you. You must complete several forms, propose a strategic Offer, and complete a collection information statement. This process can be especially difficult if you’re like our client and you’re self-employed and earn an irregular income.

For the best chance of negotiating an Offer in Compromise that will work best for you and your financial situation, it’s essential to contact an experienced tax attorney who can help you navigate the process.

Settling $220,000 in IRS Tax Debt for $9,000

Lucy Petry

Tax Attorney and CPA at Petry Law Firm, PLLC

Houston, Texas

We had an individual taxpayer who owed approximately $220,000 with penalties and interest. They were a high-income-earning attorney who had always paid their taxes on time. Unfortunately, due to medical issues, they fell behind on their taxes which quickly ballooned out of control. Their medical issues also led to a reduced workload and eventually no work for an indefinite time.

We decided that the client was the perfect candidate for an Offer in Compromise. Our goal with this case was to explain to the IRS the nature and severity of the taxpayer’s medical issues. We also wanted to show that the taxpayer had a clean history and had always paid their taxes on time. 

The result was that the IRS accepted an Offer for $9,000. This was one of our favorite cases as the taxpayer was an excellent candidate for an Offer in Compromise due to life changes outside of their control.

Saved a Client Over $230K Just in Time for Her Wedding

Morgan Anderson

Enrolled Agent at Golden Lion Tax Solutions

Lakewood, Colorado

A client came on board with the typical situation we see at Golden Lion Tax Solutions: several missing personal income tax returns, substitute returns created by the IRS that resulted in balances owed, and the IRS breathing down the client’s neck with the threat of aggressive collection actions. 

Time was of the essence as our client was waiting to get married to prevent entangling her future spouse with the debt as she lived in California, a community property state. Through our relentless efforts, we stopped the IRS from acting on the collection threats while the client, a self-employed Realtor completed her outstanding tax returns and began making estimated income tax payments. 

Once we could prove she met the tax compliance prerequisites, we submitted an Offer in Compromise. We proposed a settlement of $7,232 on a past-due income tax debt of about $248,000 from nine years of returns. 

The Offer Examiner gave us a counteroffer of $47,491. The number was high because the Examiner disregarded all of the client's expenses that exceeded the IRS's accepted standards. We held firm that the client could not afford that settlement, and we submitted additional documents that showed the client's actual financial limitations. 

Finally, we settled on a final Offer amount of $9,973. That allowed our client to save $238,000 or 96% of her total tax bill. 

Key Point: While an Offer in Compromise settlement is indeed determined based on the client’s unique financial condition, having the right team representing the client’s interests with the proposed settlement is critical. During our 24+ years in the tax debt resolution arena, we have learned how far to push, and more importantly, when not to push further, when negotiating with the IRS.

Never take the first rejection as the final word… or the second or third! However, the art of negotiation and knowing the rules the IRS has to follow while considering a resolution proposal plays a big role in the results you ultimately end up with. It is important your representative throws on the battle armor and fights to whittle down the number as much as possible before saying, “This is it… this is the best settlement we can secure for you!” 

Settling Over $200,000 in Tax Debt for $100 Monthly Payments

Martin Cantu

Enrolled Agent at Austin Tax Help

Round Rock, Texas

A retired taxpayer living off a small pension and Social Security contacted us about a $200,000 tax debt. He had previously been a real estate investor, and the tax debt stemmed from the forgiveness of a debt issue related to one of his investments. He was unaware that the debt forgiveness would lead to a tax liability, and he couldn't afford to pay it. 

We started with an initial assessment of his finances to see if he would qualify for an Offer in Compromise. We don't waste time submitting Offers that won't be accepted. For example, if you have a large mortgage, lease luxury cars, and send your children to private school, you are not going to qualify for an OIC. 

In this case, our review indicated that the taxpayer could not pay his tax debt as well as his normal expenses and rising medical costs due to his age and health. I submitted a financial plan to the IRS highlighting increased medical expenses, and modest living expenses which were within IRS national standards. 

I was able to demonstrate that the taxpayer could afford to pay $100 a month for 36 months, and the IRS accepted the proposal. This represented savings of over $200,000, including interest and penalties.

Bottom Line: Tax collection is a process and not an event. The IRS is a mammoth bureaucracy consisting of people and technology and often wires get crossed, information gets lost, cases get re-assigned, etc. One of the keys to success in Offers in Compromise is persistence. 

It’s not uncommon to have an initial rejection only because it was administratively convenient for the IRS. I’ve had several Offers accepted that were initially turned down. I also try and get my cases before an individual collection officer so that I can make my case to a person and not a machine.

Sometimes it’s better in the long run to determine early that an Offer in Compromise won’t work. In my experience, that’s not the end of the world for taxpayers. Early recognition allows you to make an alternative plan that can ease the pain of tax payment. You need someone experienced in tax collection to successfully navigate through that process.

Helping a Client Settle Her Tax Bill After a Debilitating Car Accident 

Tammy Graham

EA, MSA at Pro Tax Advantage

Logansport, Indiana

Our client was a high-wage earner who was in a very bad car accident, causing her to be a quadriplegic. She had amassed an IRS tax bill of $123,600 due to early withdrawals from her retirement fund, which she could not now pay. 

While preparing her financial statement for the application, we had to pull together a huge amount of information to support her additional medical and living expenses. Normally, when reviewing an Offer in Compromise, the IRS only allows you to spend a certain amount in each category, and if you go over that standard, you need to explain why. 

This taxpayer required supportive clothing, adult diapers, daily water therapy, and many other special expenses, and her willingness to work with me and dig for the extra expenses was a huge factor in our successful Offer. However, this was not easy as it required her to be vulnerable and share a lot about the struggles she had being wheelchairbound and dependent on others. 

Ultimately, we made an Offer of $5,304 which was essentially the equity in her car. We filed the OIC on 2/26/2021 and it was finally accepted over 18 months later on 10/25/22. She had so much resilience of spirit and I was happy to provide her with this peace of mind so that she could focus on her health. 

Critical Takeaway: The big box resolution companies don't connect with clients on a human level. My clients are not numbers or fees. They are people in need of help. If you are willing to work hard, I'm willing to work harder. 

Appealing the IRS's Original Offer to Save the Client More Money

Steven Striffler

Tax Attorney and Bankruptcy Attorney at the Law Office of Steven R. Striffler

Quincy, Massachusetts

Our client was drowning in $85,000 of tax debt due to unpaid payroll taxes and Trust Fund taxes due to the closure of their long-term business. The IRS had filed a tax lien against their personal assets, escalating the urgency of finding a solution. 

To start, we did a thorough analysis of the client's assets and current income. The IRS uses these numbers to determine the taxpayer's reasonable collection potential and the amount of their settlement. By developing an in-depth understanding of the client's financial landscape, we could present a compelling case to the IRS, proving the client's genuine inability to meet their original debt obligation. 

The IRS said they would accept an Offer of $45,000. Although this was a substantial reduction, we knew we could get a lower settlement, and we advised the client to reject the Offer. This decision proved pivotal. After presenting a robust case in the appeals process, we successfully negotiated a final settlement amount of $9,725. This remarkable outcome not only saved our clients a significant sum but also provided them with the much-needed financial relief to move forward and get a fresh start.

Final Word: In the complex world of tax debt resolution, personal attention and a tailored approach are indispensable. At Striffler Law, we take pride in being more than just legal representatives; we are tireless advocates for our clients. When faced with overwhelming tax debt and looming tax liens, it's crucial to remember that you're not alone. Reach out to us at Striffler Law for dedicated support and a personalized strategy tailored to your unique circumstances.

Our journey with this case underscores the importance of perseverance and strategic decision-making in navigating the intricacies of tax debt resolution. We believe that every case is unique, and success lies in understanding the individual nuances of our clients' financial situations.

To those in a similar situation, we offer this piece of advice: don't settle for the first Offer, and don't hesitate to appeal. The tax resolution process is complex, but with the right team by your side, it's possible to turn the tide in your favor. At Striffler Law, we're not just resolving tax debt; we're crafting success stories.

Settling $69,700 in Tax Debt for $180

James Cha

CPA & Certified Tax Resolution Specialist at Ace Plus Tax Resolution

Los Angeles, California

Our client Hernando was self-employed in the transportation business, and he owed the IRS $69,700 for tax years 2008 to 2017. 

He had been trying to turn his business around but had experienced several setbacks including a tough business environment. He had also filed for bankruptcy in 2012. 

The IRS had issued LT11 Final Notice of Intent to Levy and CP504 Final Notice of Intent to Seize Property. His situation was quite urgent since he came to me for help almost right before the actual levies. He also was worrying about landlord’s eviction, foreclosure, or utility shutoff. 

I did his Financial Information Analysis Resolution Option Recommendation. He said he was impressed by our high level of professionalism in our system and overall approach.

His business vehicles were purchased with an SBA Loan and also used for commuting.

His two daughters had been providing support for a portion of living expenses but were unable to continue the support any longer. We analyzed and prepared the current business P&L statement showing decreased business performance. 

My strategies included advising the daughters to notarize an Affidavit about their inability to continue to provide support. Also, he could not make the estimated payment for the year of submission which is a required compliance step for an OIC review. However, using the IRS’s special extensions for disaster area taxpayers, we guided him on how to become compliant. 

After several negotiations back and forth with the Offer Examiner, the IRS finally agreed with and settled for our initial Offer amount of $180. 

Our client said that it was a stressful journey, but now we definitely need to take a moment to take this gigantic moment in and celebrate! He testified that the representation he paid our firm was the best investment with the greatest return he ever made in his whole life.

Why Hiring a Tax Pro Is Critical: Hernando's case exemplifies why DIY tax settlement is inadvisable. Currently, the average acceptance rate for an IRS Offer in Compromise (OIC) is only about 30%. A competent tax relief professional who is negotiation savvy can customize strategies to help you achieve successful outcomes. 

If you are not eligible for an OIC, we may be able to get you into a Partial Payment Installment Agreement based on your financial information. Sometimes, we find another best alternative to legitimately reduce your total IRS or state tax debt. Don't lose hope about resolving IRS or state tax debt. His success story can be yours too.

Helping a Family Settle a Large Tax Debt

Susan Puckett

Enrolled Agent at Stark Tax Services

Colorado Springs, Colorado

A family of 5 was over $90,000 in debt to the IRS and another $24,000 in debt for state taxes. We were able to offer the IRS $100.00 and the state $15.00

By working with the Revenue Officer, we able to erase the debt to the IRS, as well as educate the taxpayer on the importance of paying estimated taxes and keeping receipts and documentation of business expenses.

Custom Touch: I believe asking questions to understand why the debt occurred and educating the taxpayer on how to prevent this situation is a key factor in customer service and tax education.

Helping a Client With Unfiled Returns Save $237,000

Bradford Simmons

CPA at Ocean Consulting Services LLC

Plymouth, Massachusetts

Our client hadn't filed tax returns for 10 years, and the IRS just approached him about a missing tax return. He was in a panic when he contacted us, so job number one was ensuring him that there was a solution — we've done this before and we can help. 

Our client ran a successful sole proprietorship and was required to report his business income on his personal tax return. Years earlier, his business records were destroyed in a flood, and he couldn't file his return. Going forward, he continued to not file, fearing once a return was filed that the IRS would ask about the missing returns. 

We determined that the client should request an Offer in Compromise, but before he could apply, he needed to get in compliance with the IRS. This means filing tax returns for the last six years and paying the current year's taxes through wage withholding or paying estimated quarterly taxes. 

To get started, we needed to create books and records for the business. The client gave us his proverbial "shoe box" of bank statements, 1099s, expense receipts, etc. Then, we got the business up and running on QuickBooks and created income statements for the past six years. We then prepared and filed personal tax returns reporting the business income.

Once the taxpayer was in compliance, we started to prepare the Offer. We compiled information related to his personal and business assets, debts, future income, and expenses. Then, we applied various IRS rules and conventions to determine a settlement amount. While crafting the Offer, we excluded the equity in his personal residence. We did not think the IRS should include this equity in the Offer because he owned the house with a family member, and they shared household expenses. In our opinion, he couldn't reasonably sell the home when someone else also lived there. 

The IRS rejected the initial Offer, based on the opinion that his home equity should be included and thus he didn't qualify. We appealed, and we prevailed with the home equity argument. 

The IRS accepted a $19,000 Offer on a $256,000 tax debt. That's a reduction of $237,000.

Bottom Line: No matter how long it's been since you filed, there is a solution, and an experienced tax professional can help you find it.