Giving
Away Assets and an IRS Offer In Compromise
Question:
3 years ago I
transferred the deed to my house to my wife. I also let her withdraw
money from our joint accounts and put them in her own name. I owe the
IRS taxes for the last 2 years. Can I do an Offer In Compromise?
Answer:
The IRS gives an
OIC
for 3 reasons:
1. Doubt
as to
liability; or
2. Inability
to Pay; or
3. Special reasons favorable to the government.
Since your argument is doubt concerning the ability to pay, the IRS
demands you complete a 433A Collection Information Statement. Line 16
of the 433A requires you to disclose ANY
ASSETS
transferred for less than full value within the past
10 years. The IRS
calls these Dissipated Assets.
The government closely looks at the transaction for when it was
transferred in relation to when the Offer was submitted, how it was
transferred, and the value of the assets versus how much was received.
In
this case, the IRS would include the dissipated assets in your gross
estate and require you to pay as if you still held them.
Call me
at (856)
665-2121 today!
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