$55,000 IRS Tax Debt Settled for Just $676 Through Offer in Compromise

SITUATION:

A business owner burdened with $55,000 in IRS debt—caused by missed estimated payments, audit penalties, and business management challenges—sought our help. The large balance and constant IRS collection pressure created significant stress. Their goal was to resolve the debt with a realistic and manageable solution that would restore financial stability and peace of mind.

INVESTIGATION PHASE:

Upon enrolling, we welcomed the client and began a comprehensive review of their finances, including income, expenses, assets, and liabilities.

Key actions included:

• Income & Expense Analysis: Evaluated the client’s financial situation to determine an Offer in Compromise (OIC) was feasible.
• Penalty Review: Identified audit penalties and missed payment fees that had significantly increased the balance.
• Strategy Planning: Determined that pursuing an OIC would be the most effective way to secure substantial debt reduction.

We also obtained a signed power of attorney, allowing us to communicate directly with the IRS. With access to the client’s IRS account and audit history, we confirmed the balance owed and prepared a strong case for relief.

Throughout this phase, our team provided guidance and regular updates, ensuring the client felt supported and informed.

RESOLUTION PHASE:

We submitted an Offer in Compromise to the IRS, proposing a settlement of $676 based on the client’s financial capacity. After review, the IRS accepted the offer, reducing the $55,000 debt to just $676.

Case Outcome:

• Total Amount Owed: $55,000
• Resolution: Offer in Compromise
• Settled Amount: $676
• Phases Worked: Investigation & Resolution

This resolution gave the client a true fresh start—eliminating overwhelming tax debt, stopping collection actions, and providing the financial breathing room needed to focus on rebuilding their business.

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DISCLAIMER:
This example reflects a real client outcome. Every case is unique, and results may vary. Enrollment in our program does not guarantee a similar resolution. Our experienced tax team—which includes former IRS employees, enrolled agents, tax attorneys, and CPAs—works diligently to achieve the best possible outcome for each client. Our goal is to ensure you pay the lowest amount legally required based on your individual circumstances, finances, and allowable deductions.