If you can't pay your IRS balance in full, an Offer in Compromise may let you settle for less when you qualify. We review eligibility, prepare Form 656, and represent you—free consultation.
Quick answer: An Offer in Compromise (OIC) is an IRS tax settlement program that may allow qualifying taxpayers to pay less than the full balance owed. Eligibility depends on income, assets, expenses, and filing compliance—not everyone qualifies. Valor helps evaluate reasonable collection potential, prepare Form 656, and represent you before the IRS. Free eligibility review · Part of the IRS Fresh Start relief options.
Watch our expert explain how Offer in Compromise works and how it can help you
This video provides an overview of the Offer in Compromise process and what to expect when working with Valor Tax Relief.
A legitimate IRS program that allows you to settle your tax debt for less than the full amount owed
An Offer in Compromise is a formal agreement between you and the IRS that allows you to settle your tax debt for less than the total amount you owe. The IRS may accept your offer if they believe:
You have filed all required tax returns and are current with your tax obligations
You are not in active bankruptcy proceedings or have recently emerged from bankruptcy
You can demonstrate genuine financial hardship and inability to pay the full amount
Note: Not everyone qualifies — the process requires a formal application with detailed financial documentation and typically takes several months to complete.
Our experienced team simplifies the process and represents you every step of the way
Eligibility check and initial assessment
Gather and prepare financial documents
Submit your offer to the IRS
Monitor and respond to IRS requests
Finalize agreement and ensure resolution
We communicate directly with the IRS to ensure the best possible outcome for you.
"I'm a self-employed truck driver and my tax debt kept me up at night. Thanks to Valor Tax Relief, I successfully settled and saved over $30,000. Incredible!"
Carlos M.
Texas
Review authoritative IRS guidance related to this topic. Valor Tax Relief is not affiliated with the IRS.
Complex IRS collection and audit matters may involve representation by affiliated tax professionals including James Leon Sharmat, Esq., Valor Tax Relief's lead tax attorney with 25+ years of IRS experience. Request a free consultation.
No. The IRS accepts OIC applications only if you can demonstrate you are financially unable to pay the full amount and are compliant with prior tax filings.
Savings depend on your reasonable collection potential (RCP)—income, allowable expenses, and asset equity—not the amount you owe. The IRS accepts roughly 25–30% of OIC applications nationally. Accepted offers can be below the full balance, but amounts vary and are not guaranteed.
Typically between 6 and 12 months, depending on case complexity and documentation. The IRS has 24 months to make a decision, but most cases are resolved within a year.
Not necessarily. In many cases, the IRS suspends or defers enforcement actions such as asset seizures and wage garnishment while an OIC is under review. A federal tax lien may still be filed. We can explain how this typically applies to your situation.
Not required, but strongly recommended. A professional team like Valor Tax Relief increases your chances of success and avoids costly mistakes.
Yes. You can submit a new application if your financial situation has changed or errors were fixed.
There is a $205 application fee, unless you qualify for low-income status. A down payment may also be required based on your offer type.
The IRS accepts approximately 25-30% of OIC applications nationally. Professional representation can improve preparation and documentation, but outcomes are not guaranteed and depend on your financial facts.
You'll need 3 months of bank statements, pay stubs, tax returns, expense documentation, and asset information. Our team helps gather and organize all required documents.
Yes, in most cases. The IRS considers reasonable living expenses and allows you to keep essential assets. Your home equity and vehicle value are factored into the offer calculation.
You must file and pay all taxes for 5 years after the OIC is accepted. Failure to comply can result in the OIC being revoked and the full debt reinstated.
Yes. The IRS offers two payment options: lump sum (paid within 5 months) or periodic payments (paid over 24 months). Periodic payments may require a down payment.
If rejected, you can appeal the decision or explore other options like installment agreements or currently non-collectible status. Our team helps evaluate the best alternative solutions.
Call us at (800) 252-0141 for a free consultation. We'll evaluate your eligibility, explain the process, and help you determine if an OIC is the right solution for your tax debt.
Our team of experienced tax professionals is here to help. Contact us today for a free consultation about your Offer in Compromise.
Get Your Free Consultation