St. George Consulting Inc.
Offers in Compromise Information

If you have a liability to the IRS, please read the following information carefully. If you feel you qualify, contact me and we can discuss it.
My name is Raef S. Guirges and I can be reached at 310-329-1963. Because I am so sure of myself and my knowledge of the Offer process...

I am Willing to Share Some of the Information

Offer in Compromise has been built into the tax code since 1914.   It gives the IRS authority to compromise liability. Certain changes over the last three years have made compromising a liability much easier than ever before.  Now there is much less bureaucracy built into the process, than in the past.

REQUIREMENTS:

There are three basic requirements for an Offer in Compromise.  But before I go into them, let me tell you what is not required. It does not matter how long you have owed the tax. It does not matter how much you owe as long as your total debt is above (around) $10,000.  However, we are always testing the IRS for lower amounts. We just filed an Offer on a $7,000 liability. If they accept it for processing, I'll revise the above figure.  If you owe less than the above amount, an Offer might not be the right solution for you. But that does not mean a solution does not exist

CURRENT COMPLIANCE

You must be paying and filing on time and you must agree to pay and file on time for five years. If you have un-filed returns, I can prepare them for you.  If you pay estimated tax payments, you must pay them quarterly. Paying when you file is not good enough. You may need to learn about the Annualized Estimated Tax Method, if your income is variable.  Talk to your tax professional about AETM.

NET EQUITY IN ASSETS

To arrive at the minimum offer amount, you need to calculate Net Equity in Assets. Net equity is derived by taking the value of the asset and subtracting the obligations against it. Example:  if your car is worth $10,000 and you owe $9,000, you have $1,000 in net equity. The offer cannot be lower than your Net Equity in Assets.  The IRS is not interested in the personal property you own, but they are interested in whatever is recorded. That includes things which are recorded with the County Recorder, such as your home, car, boat or plane.  They are also interested in the value of assets you inform them about, such as the balance in checking or savings accounts, the net value of your credit cards and the cash value of your life insurance.  They also look to your past tax returns to determine if you own stocks, bonds, IRA's etc. etc. Please understand that the offer process is complicated, and very much case dependent, many subtle things can legally and ethically be done to correct problems with net equity in assets as long as the asset is not disposed of for less than full value.

INCOME ABOVE EXPENSE

Awhile ago, I told you that you have to be compliant for five years.  That's sixty months and sixty months is a very important time period for the IRS.. If you have $100 above ordinary and necessary income and expense as defined by the Internal Revenue Service, using both real figures and figures derived from National Standard Expenses, that $100 will cost you a minimum of $6,000 ($100 x 60 months). That's why your income and expense must be carefully and professionally analyzed before an offer is filed.

While that sounds really terrible, most of my clients do not have income above expense.  Those that do, and are self employed, can make minor adjustments in business expenses that can bring that figure into line.

(For Your Information)

I do not file offers for people who do not qualify.

DETAILS OF THE PROCESS:

Once I determined that you qualify, the paperwork needs to be completed and filed.   It is filed with a group called Special Procedures.  There is a Special Procedures Branch at most regional IRS offices. Once it's filed, you wait about four to six weeks before a letter arrives stating that your offer has arrived and looks like it can be processed or it is returned for some sort of correction. Once you get that letter, it will be (about) another four months before you receive a letter from an Offer Technician or Revenue Officer who will investigate your offer.  He will ask you to provide him with proof of income /expense and assets /liability, all flowing from the information you gave them when you filed the offer. About two to four months from that time, your offer will be accepted, modified or rejected. Very few offers are rejected.   Most offers rejected outright are rejected because the taxpayer lied.  The taxpayer may have forgotten about an asset that was discovered in investigation or he may not be aware that an asset is in his name.  Because we do not file offers which will not qualify, we have a 95% success rate.

The IRS frequently requires small modifications from the original amount of your offer, which when agreed upon, is then accepted.  In terms of Offers in which a higher dollar amount is demanded, most of the time, the difference involves the blue book of the car and does not add up to much.

When the offer is accepted, the payment must be made within a time period specified by the offer or (you) when it was originally filed.  Once paid, the liens are lifted and the taxpayer is free of the liability conditional on current compliance. Yes, free of liability.  You are not required to come up with all the money at one time. The IRS allows a pay-off on the offer with certain limitations.

My job is to guide you through to a successful conclusion from the initial investigation of qualification, to the receipt the letter of acceptance.  I do that all by mail, phone, facsimile and E-mail. I have had clients all over the United States.   With instant communication available, it's relatively easy. I'm located in Torrance, California.

If you wish to see me personally, you can always come down my office. You are certainly welcome.  Just call for an appointment.

The most important question is do you qualify?

As you will recall, the first qualification is Income above Expense.  For most of the self employed people I deal with, once the business, personal expense and tax is computed no excess income is left.  If you qualify for an offer and you are making monthly payments to the IRS, I can secure a hardship relief to eliminate the payment arrangement.

If you feel you have so much excess income, making the payment to the IRS is no struggle for you...you should probably stop here because you would not qualify.

The key question is this: Assuming you have no income above expense, what percentage of all the tax you have due, would your Net Equity in Assets pay off.....some examples.

Example 1 - Let's say you have $20,000 in Net Equity in Assets and owed the government $15,000.  An Offer is not appropriate.

Example 2 - Let's say you owed the government $40,000 and had net equity in assets of $20,000.  That's a pay-off at 50% and that sounds great however, could you really convert your assets and/or get that much by the time you had to pay? In most cases, probably not, so again if that's the case, it may not viable for you.  But there are things about this situation which can be explored.  Call me for a consultation if this is your situation.

Example 3 - Again you owe the government $40,000, but have $6,000 in Net Equity in Assets and could, by whatever means, come up with $6,000... an offer of 15% of the total liability completely paying off the IRS sounds great to me.  How does that sound to you?

Example 4 - Probably above 70% of that's basically as much information as I can give you without talking about your personal situation.  It would be in your best interest to get more information. Compromising liability makes good business sense.  My phone number again is 310-214-5208 and my telephone consultation is free of charge or obligation.

Clients have no net equity in assets other than the car.  If $40,000 is owned and an offer of $2,000 is made and accepted, that is 5% of the liability, that is a great offer...

If  you are asking for this information because you, or someone you know, has a tax problem and needs assistance, why should you ask for my assistance?

I've been helping taxpayers with Offers since 1980. In that time I've really lost count of how many offers I've successfully completed.

For those who are far away from my office in Torrance,California the questions come up, can I assist you at this distance as effectively as I assist local taxpayers.  The answer to that question is yes. Your offer will be filed at your District Office. My Power of Attorney will be filed with your regional center. The IRS is everywhere...and the exact same rules that apply in the district office in Los Angeles County apply to all District Offices.

I know IRS and the process upside down. In fact, a number of accountants and other tax professions, have learned from my lectures.

Owing the IRS is dangerous...I can help you resolve the problem, but you have to take the first step. Give me a call
310-329-1963...today.