We return to our "back to the basics" series and look at what you need to do prior to filing your offer in compromise.  This post won’t be a full step-by-step instructional manual telling you everything to do prior to filing your offer in compromise, but it will give you the major things that need to take place before the IRS can accept an offer in compromise. 

    The first thing you need to do is "get current."  Well, what do I mean by get current, you ask?  You have to be current with all of your income tax filings for the last six years, meaning you need to go out and file those returns if they are not filed yet. 

    Second, you need to be current with the current year’s income taxes.  So, if you owed money last year, you need to be making quarterly estimated tax payments.  If you have specific questions regarding whether you should be paying estimated tax payments, I encourage you to speak with your accountant. 

    The next thing you will want to be doing is "getting organized."  When you file your offer in compromise, you will be sending in a financial form and a lot of "back-up" data.  Start getting organized now by keeping all of your current bills for living expenses such as mortgage statements, leases, car payment notices, utility bills, bank statements, etc.  This is generally the most tedious and time-consuming part of applying for an offer in compromise so I encourage you to go ahead keep that stuff organized.  You will need it when you submit the offer, and you will need to keep them updated during the offer in compromise review process because the offer examiner may ask for updated information at any time. 

    If you are interested in a full-blown step-by-step guide to filing an offer in compromise, I encourage you to visit this page and fill out the short survey.  The information you provide will be very helpful as I try to determine the best format for a new offer in compromise guide, and on top of that, I am giving away a great discount on the product when it comes out to those who take the few minutes to fill out the survey.  Thanks!