Updated July 24, 2015
The Offer and Compromise System in the Import Export Industry Chicago Illinois
So what does one do if we owe a lot of tax, and simply can’t pay it? If you are a professional involved in the Import / Export Industry of Chicagoland, then you probably make more money than the average factory worker.
As such you you are probably a target. The IRS and the Illinois Department of Revenue spend much of their time acting like collection agencies. Their job is to enforce the law and collect as much money as they can, given existing tax law. If they are coming after you for a large amount that you cannot pay, then what do you do?
I’m sure you’ve seen the commercials on TV where someone is advertising that they were able to settle unpaid taxes for pennies on the dollar. As a top rated Public Accounting Firm in Chicago, we have done exactly the same thing on several occasions. Generally, the process is called Offer in Compromise. In many ways, it works just like it sounds. You make an offer on the unpaid liability. They do some investigation. Hopefully there is a compromise.
At the Federal Level,The IRS’ job is to collect one dollar more than they could expect to collect in a reasonable amount of time. A such, each case is very different, given the financial and medical circumstances of the individual or the company. Let’s say that you are ninety-five years old and confined to a hospital bed. If the IRS is convinced that you don’t have the money, and that they will be unable to collect it from your estate, then the Feds are probably going to be rather lenient is reducing a liability.
Make no mistake about it,The Internal Revenue Service is generally in no hurry whatsoever to reduce any tax liability. If you no longer have a company, do not own a home, have a late model car, three sticks of furniture, and are on unemployment, then they will probably, grudgingly, reduce the taxes that you owe. The process does take a lot of time, but it does work, in many circumstances.
The Offer in Compromise process for the State of Illinois is much different. It is actually handled by the Appeals Board. You submit information on your financial status and make an offer. The offer is either accepted or rejected. The difference is that there is no haggling back and forth. This process generally takes much less time than its IRS counterpart. The collection information originally submitted must be complete, and the offer must be reasonable.
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Chris Amundson is the President of Accounting Solutions Ltd., a full service public accounting firm of Certified Public Accountants and Enrolled Agents handling the bookkeeping, accounting, tax preparation, and audit representation needs of Businesses, Estates, Trusts, and Upper Income Individuals