Tax Tip 2024-54: Taxpayers can appeal a rejected offer in compromise

IRS Tax Tips

May 30, 2024

Issue Number: Tax Tip 2024-54

Taxpayers can appeal a rejected offer in compromise

If the IRS rejects an offer in compromise, taxpayers have 30 days from the date on the rejection letter to request an appeal of that decision.

To request an appeal, a taxpayer must file Form 13711, Request for Appeal of Offer in Compromise, or send a letter to the IRS with certain information about their situation. Taxpayers should mail their request for an appeal to the office that sent them the rejection letter.

How to decide whether to submit an appeal
To identify areas of disagreement and decide whether to submit an appeal, taxpayers should review the Income/Expense and Asset/Equity Tables that came with the OIC rejection letter and Form 656, Offer in Compromise.

Documents to gather and review prior to submitting an appeal
Corporations, S corporations, partnerships, tax exempt organizations and limited liability companies defined as a corporation and other LLCs:

Form 433-B (OIC), Collection Information Statement for Businesses
Other supporting documentation

Individual wage earners and self-employed people:

Form 433-A (OIC), Collection Information Statement for Wage Earners and Self-Employed Individuals
Other supporting documentation

Taxpayers must be accurate and complete when addressing the reasons for disagreement
For each area of the offer in compromise rejection where the taxpayer disagrees with the IRS, they need to provide documents to support the income item, expense item and asset value they dispute.

For details on the supporting documents and kinds of records to keep, see Section 10 of Form 433-A (OIC) and Section 7 of Form 433-B (OIC) in Form 656-B, Offer in Compromise (Booklet).

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Issue Number: Tax Tip 2024-54