If you are in significant tax debt to the Comptroller of Maryland or the Internal Revenue Service (IRS), you may have the option of negotiating what is known as an offer in compromise to resolve your debt. This is an offer made to the relevant tax authority to pay off a portion of your tax debt through a payment plan and to have any remaining balance forgiven once that payment plan is complete.
However, neither the Comptroller’s Office nor the IRS is willing to accept offers in compromise every time, and tax authorities will take into consideration various factors when determining whether to accept your offer. If you want to achieve the best possible resolution from negotiating with the IRS in Baltimore, you should strongly consider seeking the help of an experienced tax resolution lawyer from Whiteford Tax Defense.
Under current IRS policy as of 2025, the IRS can cite three reasons for accepting an offer in compromise made to them by a Baltimore tax debtor, all of which we can help you establish when negotiating with the IRS if applicable. First, the IRS can accept such an offer if there is serious doubt as to liability for the tax debts in question, meaning that there are reasonable grounds in the eyes of the IRS for you to dispute whether you specifically are liable for your assessed debts or what amount of tax debt you actually have.
Second, the IRS can accept an offer in compromise if there is doubt as to collectibility, which means the IRS believes the total financial value of your personal assets and income does not exceed the total amount of tax debt you owe, making it impossible for the IRS to actually collect on the full debt. Third and finally, the IRS can cite effective tax administration as grounds to accept an offer in compromise, meaning the IRS recognizes that making you pay the full amount you owe would create economic hardship for you or be inherently unfair due to your unique circumstances.
Generally, the IRS will only accept an offer in compromise if you offer to pay less than the total value of your tax debt but more than the IRS could have collected from you through means like asset seizure and wage garnishment. From there, you have two options for how to approach the payment process: a lump sum offer and a periodic payment offer.
The former entails you paying off the full amount you offered in five or fewer installments within five months of when the IRS accepts the offer, starting with an initial payment of at least 20 percent of the total offer, while the latter entails you making at least six monthly payments over a period of up to 24 months. Once again, our Baltimore lawyer can provide vital support when it comes to negotiating the ideal terms for your offer in compromise with the IRS or with the Maryland Comptroller.
Even if you meet all the requirements to make an offer in compromise, getting federal or state tax authorities to accept that offer can be both procedurally complicated and practically challenging. That is doubly true when it comes to negotiating with the IRS in Baltimore for an offer in compromise with favorable terms for you, especially if you try to do it alone.
Guidance from a knowledgeable tax defense lawyer can make a world of difference in how smoothly and successfully your negotiations for tax debt resolution go for you. Call Whiteford Tax Defense today to discuss your options.