Tax Resolution and Representation before the IRS

IF you’re experiencing financial hardship and struggling to pay back taxes, you're not alone—and you’re not without options. Whether it’s due to a job loss, medical emergency, or other financial setback, the IRS offers several tax relief programs designed to help individuals and business owners in distress.

In today’s article, we’ll break down the most effective IRS relief options and explain how a tax resolution professional like AM Tax Inc. can help you get back on solid financial ground.

What Is Financial Hardship in the Eyes of the IRS?

Financial hardship, or what the IRS calls “economic hardship,” occurs when paying your tax debt would prevent you from covering basic living expenses. The IRS doesn’t want to put taxpayers in a position where they can’t afford food, housing, or medical care. That’s why they offer relief options for qualifying individuals and businesses.

But make no mistake—the IRS won’t automatically know you’re struggling. You must proactively demonstrate your situation and apply for the appropriate program.

How a Tax Resolution Professional Can Help

Navigating the IRS’s complex programs is difficult, especially when you're already under financial stress. At AM Tax Inc, we specialize in helping individuals and business owners in hardship find the right path forward.

Here’s what we do:

Evaluate your current financial situation and identify the best relief program

Prepare and submit accurate financial documentation

Negotiate with the IRS on your behalf

Stop aggressive collection actions and give you peace of mind

Create a personalized strategy to help you move forward with confidence

Tax Relief Options for Financial Hardship

Common Tax Relief Options for Financial Hardship

Currently Not Collectible (CNC) Status
If you can prove that you have no ability to pay—after accounting for necessary living expenses—the IRS may temporarily halt all collection activity. While your debt doesn’t disappear, CNC status prevents levies, garnishments, and other enforcement actions. Interest and penalties may still accrue, but this can buy you valuable time.
Offer in Compromise (OIC)
This is the IRS’s “settlement” program. If you can’t pay your full tax debt without severe financial hardship, the IRS may accept a lesser amount as full payment. Qualifying requires a detailed financial analysis, and approval rates are low without expert help—but it’s a powerful option for the right situation.
Partial Payment Installment Agreement (PPIA)
This type of payment plan allows you to pay less than the full amount you owe over time. The IRS will review your financials and determine what monthly amount you can realistically afford. At the end of the collection period, any remaining balance may be forgiven.
Penalty Abatement for Reasonable Cause
If financial hardship or other situations prevented you from filing or paying on time, you may qualify for penalty relief. Demonstrating “reasonable cause” can eliminate thousands of dollars in added penalties and help you stabilize your financial situation.
Innocent Spouse Relief
If your spouse (or ex-spouse) was responsible for the tax issue and you weren’t aware of it, you may be able to remove yourself from the debt. This is only applicable to cases involving joint tax returns.

Don’t Let Financial Hardship Spiral into Tax Disaster

Tax debt doesn’t go away on its own—and the longer you wait, the more penalties and interest will pile up. If you're overwhelmed and unsure where to turn, let [Your Company Name] help.

Contact us today for a free consultation. We’ll help you understand your options and fight to protect your financial future.

Tax Resolution Program Spotlight: Offer in Compromise (OIC)

When you owe more to the IRS than you can realistically pay, it can feel like there’s no way out. Fortunately, there is a powerful—but highly selective—program that might offer a solution: the Offer in Compromise (OIC).

At AM Tax Inc, we help taxpayers determine if they qualify for this program and guide them through the complex application process. Read on to learn how it works, who qualifies, and how we can help you take the next step.

What Is an Offer in Compromise?

An Offer in Compromise is an agreement between a taxpayer and the IRS that settles the tax debt for less than the full amount owed. It’s designed for people who genuinely cannot afford to pay their full tax bill, either in a lump sum or over time.

The IRS will only approve an OIC if it believes:

You don’t have the income or assets to pay the full amount, and
Your offer reflects the maximum they could reasonably collect from you within the statute of limitations.

Who Qualifies for an Offer in Compromise?

The OIC program has strict eligibility requirements. Not everyone who owes taxes will qualify. Here’s what the IRS looks at:

Ability to pay – Based on your income, expenses, assets, and equity.

Current compliance – You must be current with all required tax filings and estimated payments.

No open bankruptcy – You can’t be in an active bankruptcy proceeding.

Reasonable collection potential (RCP) – If the IRS believes they could collect more from you through other means, they’ll likely reject your offer.

If you’re living paycheck to paycheck, have limited assets, or are facing a long-term financial hardship, you may be a good candidate. However, submitting an OIC without professional guidance often leads to rejection, which is why working with a tax resolution expert is critical.

Industry News:

860 IRS Employees Owe Back Taxes
Sen. Joni Ernst of Iowa shared a letter from the IRS disclosing the number of employees.

Not even employees of the Internal Revenue Service can stay out of tax trouble.

Sen. Joni Ernst, R-Iowa, is calling for an audit of the IRS, accusing the agency of enforcing tax laws unevenly while failing to hold its own employees accountable for unpaid taxes.

In a letter shared with The Washington Examiner, Ernst highlighted an IRS report showing 860 agency employees have not paid back taxes, down from 2,044 in July. She argued that IRS agents “harassing hardworking folks” over tax compliance should not be “refusing to pay their own taxes.”Ernst is pushing her Audit the IRS Act, which seeks stricter oversight of IRS employees and employment practices.

In August, Sen. Ernst accused IRS Commissioner Daniel Werfel of “a complete lack of accountability” after discovering during an audit that the agency rehired workers convicted of criminal and sexual misconduct.

Man Faces Up to 20 Years

He’s accused of wire fraud and tax fraud for siphoning away company money.

A federal grand jury indicted an Alabama man on wire fraud and tax evasion charges, alleging he misused company funds while managing an Alaska-based oil field services firm.

According to court records, James Wohlers, 56, of Deatsville, Alabama, is accused of executing fraudulent wire transfers and failing to report taxable income while serving as general manager of GBR Equipment/Oilfield Services.

The indictment alleges that from 2013 to 2019, Wohlers funneled company funds into unauthorized transactions and used corporate credit cards for personal expenses. Prosecutors allege he created a separate business and funneled payments meant for GBR into its bank account.

Wohlers faces three counts of tax evasion. Federal prosecutors say he used GBR resources, including employees and corporate funds, for personal gain while imposing pay cuts on company staff.

If convicted, Wohlers faces up to 20 years in prison.

Example: When an OIC Might Work

Let’s say Maria, a self-employed single mother, owes the IRS $42,000 in back taxes from several years of unfiled returns. After getting back on track, she now earns about $3,200/month and has no valuable assets or savings.

By the time she pays rent, utilities, child care, and other essentials, there’s little left. Her financial documents show that paying the full tax debt would leave her unable to afford basic living expenses.

With the help of a tax resolution professional, Maria submitted an Offer in Compromise for $3,200—the amount the IRS determined was the most they could reasonably collect from her. After a thorough review, the IRS accepted the offer, wiping out the remaining $38,800 in debt and giving Maria a fresh start.

How We Can Help

The Offer in Compromise process is paperwork-heavy, time-sensitive, and often denied if not submitted correctly. At AM Tax Inc, we:

Evaluate your eligibility using the IRS’s formula

Calculate your Reasonable Collection Potential

Help you avoid common mistakes that lead to rejection

Prepare and submit a complete, professional application

Negotiate directly with the IRS on your behalf

Even if you don’t qualify for an OIC, we’ll explore other tax relief options that better fit your situation, like Installment Agreements or Currently Not Collectible status.

Ready to See If You Qualify?

An Offer in Compromise can be life-changing—but only if you meet the IRS’s strict criteria. Don’t waste time submitting a weak offer that gets denied. Let us evaluate your case and help you determine the best path forward.

Contact AM Tax Inc. today for a free consultation. We’re here to help you resolve your tax debt and get a fresh financial start. Scroll down below for information on how to get stared with the IRS Tax Debt resolution.

Tax Resolution Process

Step #1 Discovery

To get started with our tax resolution services, you will need to take the following steps:

Schedule a complimentary "Get Started with the IRS Tax Debt Resolution" appointment.
After the appointment, if you are ready to proceed:
Create a secure portal account, where you can safely upload any correspondence you received from the IRS or state tax authorities, as well as sign your contract, pay the bill or chat with your tax resolution specialist if needed.
Sign the contract for discovery engagement and Power of Attorney forms, which allows us to represent you before the tax authorities.
Pay the retainer
Once the POAs are processed, and initial financial analysis is performed, you will get notified you to schedule a follow-up appointment. During this appointment, we will discuss your case in details and explore possible tax resolution strategies that are best suited for your situation.

Step #2 Compliance

Before we can start working on tax relief and penalty abatement, it's important to ensure compliance with the IRS. This means that back tax returns must be filed before we can proceed with tax resolution strategies.

Once you have filed all of your tax returns, we can move forward with developing a tailored plan to address your tax issues. Your tax resolution expert will work with you to determine the most appropriate tax resolution options and negotiate with the IRS on your behalf.

By taking the necessary steps to become compliant with the IRS, you'll be on the path to resolving your tax issues and achieving financial stability.

During this step, your tax accountant will stay in touch and might request additional information needed to prepare your tax returns. All the communication is done through our secure portal.

In case there’s no delinquent tax returns to file, you can go straight to the tax resolution step.

Step #3 Resolution

Once you're compliant with the IRS, we can begin working on various tax resolution strategies, that were discussed during Tax Resolution Discovery appointment, which can help you reduce your tax debt, penalties, and achieve financial stability.

These strategies may include Offers in Compromise (OIC), installment agreements, innocent spouse relief, Currently Non-Collectible status (CNC) or other options that are best suited for your situation.

Our goal is to provide you with comprehensive tax resolution services that address your unique needs and help you achieve the best possible outcome with the IRS and the state. By working with AM Tax to become compliant and resolve your tax issues, you'll be on the path to financial freedom and have a piece of mind.