That is a lot going on for approximately $23 grand in tax debt.
First thing I noticed was that the taxpayer represented himself before the Tax Court. This is referred to as “pro se.” It happens quite a bit, and it usually does not work out well for the taxpayer.
I double-shudder when I think about “pro se” and going hard procedural with the IRS, such as with liens and offers in compromise.
Let’s walk through it:
(1) On November 16, 2016 the taxpayer filed an Offer in Compromise. The tax was approximately $23 grand. He offered approximately $12 grand.
COMMENT: There are several “flavors” of Offers in Compromise. This one was the traditional vanilla: inability to pay or to pay in full. Those late-night commercials are hawking this type.
COMMENT: Left hand: right hand. Happens all the time.
COMMENT: I have used CNC status over the years, especially during and after the Great Recession of 2008. The IRS realizes that there is no money to collect, so it places the case on hold, generally for a year or so. Their normal collections machinery is paused.
Mind you, the IRS is not writing-off the debt. They are allowing a break in collection activity, hoping your situation improves.
COMMENT. He should include additional or expanded financial information, as his offer was based on inability to pay. The common-sense response to rejection of an offer based on inability to pay is to expand on why one is unable to pay.
COMMENT: Stop that. You are not winning with that behavior.
COMMENT: Once again: no additional or expanded financial information. This action was fruitless and ill-advised.