Legal Question in Bankruptcy in California

Effect of offer-in-compromise on eligibility of taxes owed

I understand that outstanding tax balance becomes eligible for dismissal three years after the filing due date. Is this period prolonged if an offer-in-compromise has been filed within the period or does it stay fixed? If so, is it extended by the length of time OIC was open? Any input is greatly appreciated.


Asked on 11/03/02, 8:49 pm

2 Answers from Attorneys
Alvin Tenner Law Office of Alvin G. Tenner

Re: Effect of offer-in-compromise on eligibility of taxes owed

Sorry but not sure about this.

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Answered on 11/04/02, 12:15 pm
Robert Miller Robert L. Miller & Associates, A Law Corporation

Re: Effect of offer-in-compromise on eligibility of taxes owed

Thank you for your posting.

The IRS statute of limitations, per the tax code, is three years from the date of filing, as you have mentioned. However, this doesn't necessarily affect FTB taxes, and an assessment, where the IRS recalculates interest and penalties, and you do not contest them, can prolong this date.

An offer in compromise may extend that date, or create new obligations pursuant to whatever written agreement you reach with the IRS, as it is equivalent to accepting an "assessment". To find out the answer, it depends on what is stated on your Tax Transcript form (which you or your attorney can request from the IRS), and what assessments are shown in conjunction with the offer-in-compromise.

I hope this answer helps you in some way, but if you need additional information, or want to provide more details, please feel free to contact me directly via email at [email protected], or toll-free at 1-877-568-2977, and best of luck. I'm happy to help if I can in any way.

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Answered on 11/04/02, 2:44 am


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