irs-fresh-start-initiativeas part of their continuing “fresh start” initiative, the irs has announced that they will be offering more flexible terms to its offer-in-compromise (oic) program. this will enable some of the most financially distressed taxpayers to resolve their tax problems more quickly. generally speaking, an offer-in-compromise program works by adjusting down the amount of tax owed to a more realistic payment plan the taxpayer can afford to pay. this year, the irs made it easier for individuals to qualify for a streamlined installment agreement by reducing the amount of financial information required. there is also a new provision for penalty relief for unemployed taxpayers. other changes include:

  • allowing taxpayers to repay their student loans;
  • allowing taxpayers to pay state and local delinquent taxes;
  • expanding the allowable living expense allowance standards (used in cases requiring financial analysis to determine a taxpayer’s ability to pay.)

“this phase of fresh start will assist some taxpayers who have faced the most financial hardship in recent years,” said irs commissioner doug shulman. vincent mangiapane, ea federal analyst, taxbrain