General Information

Course Description

The program Offers-in-Compromise: Navigating the Process provides a technical overview of the procedure that allows the IRS to accept, at its discretion, an offer to resolve a tax liability for less than the full amount owed.

The course explains the three recognized grounds for an Offer-in-Compromise: Doubt as to Collectibility (DATC), Doubt as to Liability (DATL), and Effective Tax Administration (ETA), along with the compliance requirements that must be satisfied before submitting an application.

The content develops the determination of Reasonable Collection Potential (RCP), asset valuation using Quick Sale Value and Net Realizable Equity, and the preparation of Form 433-A (OIC), Form 433-B (OIC), Form 656, and Form 656-L.

It also teaches the application of the IRS Collection Financial Standards and the calculation of the minimum offer amount using lump-sum and periodic payment options.

The post-submission process includes negotiation with the Offer Specialist, appeals, Collection Due Process (CDP) hearings, and relevant court cases.

Course Objective

Train participants to evaluate taxpayer eligibility, select the appropriate type of Offer-in-Compromise, calculate Reasonable Collection Potential, prepare required forms and supporting documentation, and manage IRS review and appeal procedures.

Learning Objectives

• Distinguish between DATC, DATL, and Effective Tax Administration.
• Identify pre-submission compliance requirements and post-acceptance obligations.
• Calculate Quick Sale Value, Net Realizable Equity, and Reasonable Collection Potential.
• Complete Form 433-A (OIC), Form 433-B (OIC), Form 656, and Form 656-L.
• Apply IRS National and Local Collection Financial Standards.
• Calculate the minimum offer amount using 12-month and 24-month multipliers.
• Manage rejected offers, Appeals, and Collection Due Process hearings.

Who Should Take This Course

• Tax preparers who advise clients with federal tax liabilities.
• Enrolled Agents representing taxpayers before the IRS.
• Certified Public Accountants and tax professionals working with collection cases.
• Annual Filing Season Program participants interested in IRS collections.
• Professionals with fundamental knowledge of federal tax procedures.

Course Content – 5 Modules

What You Will Achieve

• Determine whether an Offer-in-Compromise is processable.
• Prepare personal and business asset analysis.
• Calculate Remaining Monthly Income and minimum offer amounts.
• Apply IRS standards for housing, transportation, and healthcare expenses.
• Prepare Form 433-A (OIC), Form 433-B (OIC), Form 656, and Form 656-L.
• Draft an Explanation of Circumstances.
• Respond to requests from the Offer Specialist.
• Evaluate Appeals and Collection Due Process hearings.

Course Materials Included

• Course Material: Offers-in-Compromise: Navigating the Process
• IRS Form 656-B — Offer in Compromise Booklet.
• Form 433-A (OIC), Form 433-B (OIC), Form 656, and Form 656-L.
• IRS Collection Financial Standards.
• Internal Revenue Manual Part 5, Chapter 8 and Part 8.
• Asset valuation exercises and Reasonable Collection Potential calculations.
• Cases: York v. Commissioner, Charnas v. Commissioner, and Lewis v. Commissioner.
• References to the Internal Revenue Code and Treasury Regulations.

Assessment

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