Offer in Compromise (OIC)
A program that allows taxpayers to settle their tax debt for less than the full amount owed.
Full Definition
An Offer in Compromise (OIC) is an agreement between a taxpayer and the IRS that settles tax liabilities for less than the full amount owed. The IRS considers the taxpayer's ability to pay, income, expenses, and asset equity when evaluating an OIC. To qualify, taxpayers must be current on all filing and payment requirements, and the IRS must believe the offer represents the most they can expect to collect within a reasonable timeframe.
What to do next
Check the notice or letter you actually received: the dates and instructions printed on it govern, not this page. The IRS page linked in Sources is the authority on the rule itself.
Sources
- Offer in compromise — Internal Revenue Service, retrieved 2026-08-20
- Form 656-B, Offer in Compromise Booklet (Rev. 4-2026) — Internal Revenue Service, retrieved 2026-08-20
Last reviewed 2026-08-20 by Tax Resolution Clarity editorial.
Sourced to primary IRS materials and editorially reviewed. Not reviewed by a tax professional. Not tax advice.
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Where to go next
The IRS publishes the rules this page describes. Your own notice governs your dates.