How does the State of Georgia’s Offer in Compromise Program work?

Have you ever wondered “How does the State of Georgia’s Offer in Compromise program work?”  I’ll tell you.

Hi, I’m Jeff Fouts, a tax attorney located in metro Atlanta, with a state-wide, and nationwide, law practice helping clients who have serious Georgia tax problems.

So, “How does the State of Georgia’s Offer in Compromise program work?”

Being able to decrease a client’s tax debt to the Georgia Department of Revenue is really exciting to me, and the good news is that it’s happening more often than ever before.

For decades the Georgia Department of Revenue has had the authority to “compromise” or “settle” a taxpayer’s tax debt for less than is owed.  (To see the Official Code section, search for Official Code of Georgia 48-2-18.1 Settlement or compromise of tax assessments; application fee).

The trouble has not been that the laws of the state of Georgia didn’t allow the Georgia Department of Revenue to compromise, or settle, tax debts for less than was owed.  That wasn’t the problem.  The law has been on the books.  They’ve had the authority to do it.  The problem was that the policies at the Department of Revenue caused department employees to almost never accept any offers, or to be more correct, they made the requirements so difficult that very few taxpayers could actually qualify for an offer, and even if they did, the required offer amount was not much of a discount off of the total tax liability.  Thus the Georgia Offer program wasn’t very attractive at all especially since it had to be paid in a very short time frame.  So the result was that it was rare for Georgia to accept a reasonable settlement offer.

So Georgia had an Offer program sitting there, but for all intents and purposes, they could have just as well not had an Offer program at all.  They had their Offer in Compromise forms that you could fill out, but what good was it?

Things have Changed – For the Better

But now things have really changed, and I mean really changed.  Georgia is now in the business of accepting realistic, reasonable, settlement Offers.

My opinion is that this change at the State of Georgia was spurred on by its great need to generate cash flow, and by its recognition that using really aggressive, hardball tactics wasn’t achieving their goal of bringing in more delinquent tax dollars, so they decided to take the opposite tact and actually offer some great solutions to help delinquent Georgia taxpayers deal with their tax problems, which, at the same time, generated more cash flow for Georgia. This is truly a win-win for both Georgia and for you.

So, how do you figure out if you’re a good candidate for a Georgia offer in compromise, and what an acceptable offer amount should be?  There are several steps to follow.

When you deal with the collection division of the Georgia Department of Revenue, or the IRS for that matter, two overarching principals apply.  The first is to make sure you have all the relevant facts about the client and about their tax debt, and there are a lot more facts that are relevant than most client’s realize.

The second overarching principal is to analyze your facts and circumstances so we can understand which options or solutions are best for you.  It is important to do this before you jump in and start taking action.  At the beginning of a tax case, you should not assume you understand what should be done in your case.  If you’re not careful you will either waste time and money pursuing a strategy that wasn’t right for you, or you’ll neglect to consider a strategy that is good for you.

It is important to examine all the facts so you will know all the options you may might have.  This is important because a client is probably a candidate for more solutions that they might have thought of.  Clients tend to only think of the solutions that are obvious to them.

In my other videos I will talk about the first steps in evaluating whether an Offer should be filed, and if so, how much that Offer should be for.

Conclusion

I hope this important video tip has helped you understand the Georgia Department of Revenue a little better and about how tax problems are solved.  Chances are you have questions or concerns about your own particular tax problem.  What I encourage you to do is pick up the phone and call me.  I can answer your questions.  Over the past 20 years I’ve represented clients all across Georgia, and in 50 states and 29 foreign countries, and I welcome your call.  You can reach me at (888) 995-6785 or by email at jfouts@taxhelpattorney.com.  I’m Jeff Fouts and thanks so much for watching.  Have a wonderful day.