A recent court case involving a
Colorado couple illustrates the risk sometimes involved in
calling the IRS on the telephone. The taxpayer called
the tax agency and after a conversation, he believed that he
entered into an "Offer in Compromise" agreement
under which he would be required to pay a total amount that
was less than he owed.
Under the deal the taxpayer
thought he made, he would make 36 payments and then owe
nothing more. The IRS contended that that the taxpayer
entered into an installment agreement, not an Offer in
Compromise.
According to the IRS, amounts
that were accrued but unassessed at the time of the first
phone call, such as interest and penalties, would not be
covered by the installment payments, and would be due even
after all of the installment payments had been made.
