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What is an offer in compromise?

Updated October 8, 20262 sourcesTaxTruce teamFact checked
The short answer

It is a deal that lets you settle your tax debt for less than the full amount, if the IRS agrees. The IRS looks at your income, expenses and what you own. Most offers are not accepted. In fiscal year 2025, the IRS accepted 5,464 of 38,797.

The IRS usually says no if you could pay in full with a plan or the equity in your assets.

Sources

  1. IRS: Offer in compromise
  2. IRS Data Book: Collections, penalties and appeals (FY2025)

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