{"id":7949,"date":"2015-11-24T02:37:04","date_gmt":"2015-11-24T07:37:04","guid":{"rendered":"http:\/\/www.escapeartist.com\/?p=7949"},"modified":"2020-09-09T12:56:03","modified_gmt":"2020-09-09T16:56:03","slug":"dont-fall-for-the-offer-in-compromise-scam","status":"publish","type":"post","link":"https:\/\/www.escapeartist.com\/blog\/dont-fall-for-the-offer-in-compromise-scam\/","title":{"rendered":"Don\u2019t Fall for the Offer in Compromise Scam"},"content":{"rendered":"

The Offer in Compromise scam is one of the most prevalent on the internet and television.\u00a0 As the first post on this new tax site, I\u2019ll explain how to avoid the Offer in Compromise scam.<\/strong><\/p>\n

Whenever you hear \u201cwe can settle your tax debt, often for pennies on the dollar,\u201d it\u2019s probably a scam.\u00a0 The truth is that very few Offer in Compromise filings are successful.\u00a0 A quality firm might succeed 50% of the time.\u00a0 The Offer in Compromise scam mills probably get 1% – 5% of the OICs they file approved.<\/p>\n

A few years ago, big firms were cashing in on the Offer in Compromise scam.\u00a0 One of them, Tax Masters in Texas, even went public.\u00a0 Then, to put it simply, the U.S. government came in and crushed them.<\/p>\n

If you want to read a bit of Offer in Compromise scam history, google Tax Masters, Roni Lynn Deutch, and J.K. Harris.\u00a0 For those of us in the industry, Tax Masters is the most interesting.\u00a0 Because of their IPO, their cash flow, how much they spent on advertising ($100M), numbers of clients, and their success rate is all public record.\u00a0 It\u2019s a good read, fantasy, history, and scam rolled into one.<\/p>\n

 <\/p>\n

Marketers Who Sell Leads<\/h3>\n

Nowadays, the Offer in Compromise scam has a different modus operandi.\u00a0 Gone are the big cash machines, replaced by marketers who sell the leads generated by their TV ads and\/or websites to anyone who will buy them.<\/p>\n

Many of these Offer in Compromise scammers have call centers in India that \u201cqualify\u201d the lead before transferring it to the buyer.\u00a0 None of them have any tax knowledge or experience in going to battle with the IRS.<\/p>\n

 <\/p>\n

Here is how to identify a scammer:<\/p>\n

(1)\u00a0\u00a0\u00a0 A qualifier answers the call and then needs to transfer to you to one of his \u201cexperts.\u201d<\/p>\n

(2)\u00a0\u00a0\u00a0 They tell you that you need expert help, and may qualify for an Offer in Compromise, if you owe $10,000 or more to the IRS.\u00a0 Most professionals won\u2019t touch a case unless you owe $25,000 to $50,000.\u00a0 At $10,000, you are much better off doing it yourself.<\/p>\n

(3)\u00a0\u00a0\u00a0 Offer in Compromise scam websites often contain a few pages of basic information and then want you to fill in a form to be \u201cpre-qualified.\u201d\u00a0 These are called landing page websites and they sell your data for $35 to $100.<\/p>\n

A LIBERTARIANS VIEWS ABOUT TAXATION (AND WHAT TO DO ABOUT IT)<\/a><\/em><\/p>\n

 <\/p>\n

Here’s The Truth<\/h3>\n

Now, here\u2019s the truth:\u00a0 in order to qualify for an Offer in Compromise, you must have minimal assets compared to the amount of the debt.\u00a0 Also, your salary must be very low, maybe $5,000 per month.<\/p>\n

So, if you owe $50,000, and have $100,000 in a retirement account, you don\u2019t qualify for an OIC.\u00a0 If you owe $75,000, and have $180,000 of equity in your home, you don\u2019t qualify for an OIC.<\/p>\n

Also, the Offer in Compromise must be in the best interest of the IRS.\u00a0 I once had a client who was 75 years old, living on social security, and, after I filed his 6 years of delinquent returns, he owed $100,000+.<\/p>\n

To be honest, I figured this was the one-in-a-million client we tax lawyers dream about.\u00a0 I was finally going to get an Offer in Compromise through for pennies on the dollar\u2026 and then use him in my marketing as a success story.<\/p>\n

Well, the IRS had different ideas.\u00a0 We went through the Offer in Compromise and appeals processes, and he was ultimately denied.\u00a0 The bottom line was that it wasn\u2019t in the government\u2019s best interest to accept an offer of $5,000 (or of any amount for that matter) from a non-filer.\u00a0 Allowing him to fail to file and pay for all of those years, and then walk away for a small amount, was not in the best interest of \u201ceffective tax collection.\u201d\u00a0 He clearly qualified, but was denied.<\/p>\n

And this is why the pennies on the dollar Offer in Compromise scam is so common.\u00a0 It\u2019s very rare that all the criteria come together, the \u201cright\u201d IRS agent is assigned, and the tax debt is cut by 75% – 95%.<\/p>\n

In the case above, the Offer in Compromise was rejected and the client was listed as uncollectible.\u00a0 He is retired and should remain uncollectible until his debt expires (10 years after the returns were filed).\u00a0 If things change, the IRS will want some cash, but everyone expects the government will get nothing\u2026 and they are fine with that.\u00a0 It\u2019s all about appearances.<\/p>\n

If you owe money to the IRS, watch out for the Offer in Compromise scam.\u00a0 If you owe $10,000 or less, I suggest you suck it up and contact them yourself.\u00a0 If you owe $50,000+, I strongly recommend you get professional help.<\/p>\n

 <\/p>\n

What’s Next?<\/h2>\n

Let’s face it, taxes for expats and the offshore markets is specialized information that your mom and pop accountant down the street is not going to understand. Speak with our CPA if you are serious about reducing your tax obligations and always staying compliant – click here to find out more.<\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

The Offer in Compromise scam is one of the most prevalent on the internet and television.\u00a0 As the first post on this new tax site, I\u2019ll explain how to avoid the Offer in Compromise scam. Whenever you hear \u201cwe can settle your tax debt, often for pennies on the dollar,\u201d it\u2019s probably a scam.\u00a0 The […]<\/p>\n","protected":false},"author":308,"featured_media":24662,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","om_disable_all_campaigns":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3],"tags":[],"yst_prominent_words":[4865,4797,4789,4777,4763,4793,4764,4785,4871,4852,4858,4882,4804,4875,4813,4823,4837,2131,4769,4829],"acf":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/www.escapeartist.com\/wp-content\/uploads\/2015\/11\/scam-4126798_1280.jpg","_links":{"self":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/7949"}],"collection":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/users\/308"}],"replies":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/comments?post=7949"}],"version-history":[{"count":6,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/7949\/revisions"}],"predecessor-version":[{"id":41182,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/7949\/revisions\/41182"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media\/24662"}],"wp:attachment":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media?parent=7949"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/categories?post=7949"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/tags?post=7949"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/yst_prominent_words?post=7949"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}