Get the free irs form 656 2020-2021

Hi and welcome to another IRS Forms video Today were tackling IRS Form 656 Offerin Compromise This is a form that you definitely want toget right the first time Any mistake you make can cause a whole hostof problems for your client including delaying their offer in compromise by months So lets take a look at a few tips thatcan help you make sure your Form 656 is absolutely perfect the first time If you think this video is helpful make sureto hit that like button and subscribe to the channel Tip 1 What is IRS Form 656 and Who ShouldUse It Form 656 is one of the forms required by theIRS for requesting an offer in compromise or OIC This form in combination with Form 433-OICFallows the IRS to evaluate your clients financial situation and their tax debt todetermine if they will accept the offer Form 656 is where you report the details ofyour proposed OIC Those details include vital information suchas the offer amount and the proposed payment timeline Its also where you make your case for whyits in the IRSs best interest to accept less money than the taxpayer owes This form is for any clientbusiness orindividualwho is requesting either an Doubt as to Collectibility or Effective Tax AdministrationOIC If you are submitting a Doubt as to Liabilityoffer in compromise then youll use the form 656-L instead of the standard 656 Tip 2 Is Doubt as to Collectibility or EffectiveTax Administration Better for Your Client Section three asks you to designate the reasonfor the offer Doubt as to Collectibility or Effective Tax Administration As stated in the IRM doubt as to collectibilityexists in any case where the taxpayers assets and income are less than the full amountof the assessed liability In other words a Doubt as to CollectibilityOIC is for clients who dont have enough disposable income and assets to pay theirtax debt The evidence for this type of offer in compromiseis collected largely through Form 433-OIC along with supporting documentation such asbank and credit card statements If your client simply cant afford to paytheir tax debt Doubt as to Collectibility is the best offer for them Effective Tax Administration on the otherhand is for clients who can technically afford to pay their tax debt but doing so wouldcause undue harm to the taxpayer or undermine public faith in IRS Basically you have to convince the IRS thatin this case not collecting the tax is more beneficial to the agency than collecting the tax The IRS isnt going to seize the assetsof a 90 year old woman living on social security or force a disabled man to sell the home hehas specially equipped to accommodate his disability For more examples of Effective Tax Administrationcases check out the links in the description Tip 3 How Do You Determine Payment Terms Section four prompts you to choose betweentwo different payment options lump sum and periodic payment A lump sum offer is for clients who can affordto pay their offer amount in 5 months or less When submitting a lump sum offer you...