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035: Offer-in-Compromise (OIC) Preparation Interview (09/12/2014) - published 02/12/2025
4 Plays2 months ago
- Courtesy: Stephen D. Yennaco /dba The Giant Game Company thegiantgameco.com/
For an IRS Offer-in-Compromise (OIC), typically required financial documents include:
- Form 433-A (for individuals) or Form 433-B (for businesses) detailing assets, income, expenses, and debts.
- Recent pay stubs or proof of income.
- Bank statements for all accounts.
- Asset documentation, such as property appraisals or vehicle valuations.
- Tax returns for the past three years.
- Monthly expense documentation to support living costs.
For monthly expenses in an IRS offer-in-compromise, provide detailed breakdowns of each category, including:
- Housing: Rent or mortgage payment, property taxes, utilities.
- Transportation: Car payments, insurance, fuel, public transit costs.
- Food: Groceries and dining expenses.
- Healthcare: Insurance premiums, out-of-pocket costs.
- Childcare: Tuition, daycare, or babysitting costs.
- Other debts: Credit card payments, personal loans.
- Miscellaneous: Entertainment, clothing, and other personal expenses.
Include average monthly amounts for each category to give a clear picture of your financial situation.
An Offer-in-Compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can't pay your full tax liability or doing so creates a financial hardship. The IRS will consider your unique set of facts and circumstances:
- Ability to pay
- Income
- Expenses
- Asset equity
The IRS should generally approve an Offer-in-Compromise (OIC) when the amount you offer represents the 'most" i.e. Reasonable Collection Potential (RCP), the IRS can expect to collect within a reasonable time. You should investigate other payment options before you submit an OIC. The OIC Program is not for everyone. Check the qualifications of any tax professional you hire to help you file an offer. https://irs.treasury.gov/oic_pre_qualifier/
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Transcript
Arranging IRS Payments
00:00:03
Speaker
and signs any signs you can work on my behalf on all fronts of the Internal Revenue Service. sure So I brought a bank check wow good for some money order which was probably eat best for you, easiest for you. okay three hundred want call that that will give you a coffee then sure I don't know you know what what that does but I hope it can get me started. oh yeah
00:00:41
Speaker
I'm keeping a running ledger of all your payments and charges so that... Well, you're an accountant, I would hope so. Do you have any questions? I have no questions. You keep me so well informed, I don't think that's a better representative to have. Steven?
00:01:04
Speaker
Well, thank you. My life's worked, right? You're up to date on everything. You're ahead of everything. You're on top of everything. You're pretty confident there, my friend. All right, so um you need to OK that.
00:01:30
Speaker
I'll give you a copy. That's our agreement.
00:01:41
Speaker
His date is the
00:01:56
Speaker
I don't know what happened, but the pen ran looks like it ran out of ink or it maybe it was dry or something. It's not either or with the rules.
00:02:07
Speaker
and found them my she wasn't using it stupid to me
00:02:38
Speaker
So that'll get you through almost the first three years. Okay, so you see that so I can come up with for some money in the next week or so to move me a little further ahead than that.
00:02:58
Speaker
Okay, because what I'm thinking is Tell me if my thinking is correct since I don't know this at all.
Concerns About Tax Returns
00:03:06
Speaker
This lady is wrote us a letter three weeks ago that she said she's going to contact us, I think on the 18th of September, which is about a week from now, right? thank you She's want to know where all the tax returns are. you know And we're not going to have all the taxes. So it's nine years, 10 80.
00:03:32
Speaker
That's what you agreed to, okay? Okay. Okay, fine. 04, 05, 06, 07, 08, 09, 09, 10, 11, and 12. That's 9. Okay. So, she's going to be displeased if we don't have all those years, but she's probably realistic thinking we're probably not going to have them all. Well, I told her, but if we had something, you can show and i can demonstrate to her that i am concerned i want to forward with this and here what we've done is we've got a couple years together
00:04:06
Speaker
can we start with that and then we expect over the next sixty days to have all the rest of them completed Yes, sir. Is that sound? I'm asking you. i'm just That's not a problem on my end. is that but is that it Do you think it you're the expert with these guys? I've never dealt with them in their temperament and their, you know, their... Modus operandi. How they operate, right? Modus operandi.
00:04:34
Speaker
so Those are just my thoughts. I'm just putting them out there. And I just wasn't
Revenue Officer's Ambivalence
00:04:39
Speaker
sure. Yeah, I wouldn't be gravely concerned. Obviously, we want to do things as most efficiently as possible or expeditiously. But i I told her I can't rush it. And she says, I understand. To be honest with you, I was quite shocked talking to her because her reaction to this whole thing was, I mean, after she saw the master file that you know you got a couple of rinky dink $10.99, one for $8,000, for $5,000, whatever. She was just, her attitude was almost ambivalence. And I was just, um I was shocked that a revenue officer would react that way. I was like, I don't care, Steve. She almost came to the conclusion prematurely that the case was gonna be unresolved. and um But I you know i told her we'd do our damnedest.
00:05:31
Speaker
Well, maybe she'll be pleasantly surprised. Yeah. Calls and says, yeah, we're, we've signed an agreement. I'm not fully representing him. We're engaging. We're getting the numbers. We're doing this. Right. Maybe she, cause she has to fill out a report to a boss too. Right. That she made her performance. Her job evaluation is based upon.
00:05:50
Speaker
how well she does in collections and handling her case. They probably don't judge how fast things move. They judge action, right? Right. Well, they do what they do. In other words, if it gets past the point of no return, whatever H hour is for them, it kind of goes into a holding tank. And then that doesn't count against her, but it's certainly not in her favor.
00:06:11
Speaker
But if it does get resolved eventually, then, you know, all the better for her too. But we'll get, we'll get it there. Um, so did you, the next question was no, the revenue. No, you didn't, you didn't you didn't come up with any disagreement was signed. I have that. I have two, at least two copies of that. So you can keep that in your file. Okay. i So this is what I'm thinking. Also, let me, let me ask you about this. You would said to her, I think.
00:06:41
Speaker
that my revenue for the company is pretty consistent over the past few years. Right? According to you. Yeah. Right. I think there are bigger swings. So last year, for example, my revenue was about $80,000. Okay. Right. The previous year it was last. The previous year before that and the previous couple years before there was less. Well, I mean, and then let me just, yeah if I go back to all five, I think it was more.
00:07:11
Speaker
Yeah. So I think we're going to have more swings and... Right. Does that make any difference in the reporting versus it being $80,000 plus or minus every year? It probably looks more realistic.
00:07:36
Speaker
Okay. So How long have you been on PayPal as far as your revenue goes a couple years Not very long and they haven't been sending you a 1099. Maybe they have all right all right Well, the thing is it wasn't um yeah all four hang on let me go to the It was not on what what do you What do you use for an ID number with them, a tax ID number? Probably gave them my my Social Security number. because um Probably my Social Security number. That's what I use for everybody on a W-9. There's nothing other than Gustavus Adolphus College in 2012. But find out what they're using, PayPal is using for a tax ID, will you? yeah I believe
00:08:36
Speaker
it would be my social security number because that's what I use on a W-9 when I provide. Oh, okay, fine, all right, fine. I use it when I send a W-9 out to a customer. Right. Before they buy off and they won't even cut a purchase order until yeah they get a W-9. Right. So I put the giant gaming company, DBA, Steven Inako,
Bankruptcy and Legal Details
00:08:56
Speaker
DBA, the giant game company, 003, my social security number. Right. And that seems to be acceptable and that's what I get when I get a 1099 from them, that's what it comes under.
00:09:08
Speaker
All right. So what when are you going to do this? This is what I need to get started. Okay. All right. Oh, oh, oh, good, good. Don't go yet. yeah Are you able to sign for Gloria? Because you both have to sign this because um her pay stubs on here.
00:09:33
Speaker
I will not go investigate her any of the guesses. No, no, no, they're not going to. Let me ask you something. Page seven. Okay. When did you file bankruptcy? I believe it was in 2010. Do you recall the month at at least? And where was it? It was June.
00:09:54
Speaker
it was june of And I believe it was in Manchester, New Hampshire in the federal building on Elm Street. And my attorney was in Concord. What was your attorney's name? Raymond Delucci.
00:10:11
Speaker
D-I-L-U-C-I-A? I think so. Delucci. So probably D, not Deluca. No, Delucci. So D-E-L-U-C-C-I, maybe. Okay, yeah, Delucci. Yeah, that looks like...
00:10:38
Speaker
and he's from Concord, New Hampshire. Do you know what his law firm? Or was it Raymond Delucci Associates, I believe. Okay, fine. It's just him. You think it was June of 2010? I believe so.
00:10:57
Speaker
Okay. um Okay, so you were party to that lawsuit against um Richelson was against me. You're gonna need copies of that? Yeah, but wait a second. When was that settled? Because you just went to court. What's his first name? Jeff. Yeah. Richelson. R-I-C-H-E-L-S-O-N. When was that settled? So this is what happened. He sued me in 2009. Okay. He got a judgment against me in the Nashua District Court. Right. When I filed bankruptcy.
00:11:35
Speaker
Raymond Delucci, my bankruptcy attorney, said as a creditor, we can do this thing called squashing or pushing down or squashing down. all right right bankruptcy He, the vendor, Jeff, objected. We went to federal bankruptcy court.
00:11:57
Speaker
and a federal judge heard his attorney, I guess my attorney, describe why I shouldn't be able to sink the thing. and Everything at the end was done. The federal judge agreed with Jeff Ridgelson and I couldn't sink it. So what happened was it was disallowed in the bankruptcy. One of the bankruptcy was complete. He went back to the national court because the national court had held off pursuing me because of the bankruptcy filing and reengaged the suit. i had to show up and give them a payment
00:12:27
Speaker
that was in august
00:12:31
Speaker
Now, did you, um, was, did he sue the corporation or did he sue you personally? Okay. That's why in my personal bankruptcy, I couldn't get rid of it. I see. Now, um,
00:12:49
Speaker
do you bank account number? No, I cannot off the top of my head. Can you look it up? yeah Not right at this moment.
00:13:00
Speaker
It's in my notes in a file just like you're looking at right now in my office, so you're okay fine and um Okay, so what you need to do then is why have you you seem to like focused on that quite a bit? Why is that the PayPal? What is it that I have not provided? No, nothing. I just don't want to I don't want to be accused but from the IRS of of
00:13:28
Speaker
obfuscating anything. I don't want to hide anything. I want to make sure I don't hide. I'll tell you why. You know, on my bank statement from my bank locally here, Southern New Hampshire, well not as it's called that, Bank of New England now down the street here, every, if money comes in through PayPal, it comes in, I don't have PayPal send me a check and I don't have a PayPal credit card. They just transfer the money to my my business bank account.
00:13:55
Speaker
Directly and on my statement every month my bank statement it says PayPal incoming payment Okay, so there's a record of every incoming payment from PayPal on my bank statement But I also do receive a PayPal statement which I can provide to you um alright
00:14:18
Speaker
Okay, so here's what you got to do pal mine you got to There's nine attachments, and they're just all they are a sub schedule you sent them to me Maybe I did yeah but listen I need you to initial this because this is I got to send this over to her I Need you to initial next to each one of these Just because it's an attachment okay, and then I need you to sign a for for yourself. And then when you sign for Gloria, you'll sign of her, sign it. Can I ever assign it? Or do you want to do it right now so you can send it off right now? Well, I don't have any thing that she's given me that says I can sign for her. I know you don't. But since she's really disjointed from this whole thing anyway,
00:15:08
Speaker
And I'm not even sure her signature is required, but I would just sign it, Steven Yoneko, your signature, F-O-R, Gloria, and print her name, Yoneko. In other words, you sign it twice, but then after the second time you sign it, you write. Let's do what I find. Initially, it's paid. Is that what you want me to do with the red line? Yeah, the last nine pages.
00:15:33
Speaker
and And... then sign where it's indicated. So this will be Steven and I'll i'll just write here for FOR Gloria because she's she's really out of the picture on this. This is none of her business.
00:16:11
Speaker
And today's date is 12. 9-12.
00:16:25
Speaker
Okay, so i write do you want me to put my signature or do you want me to rep it or put her signature? No, I want you to sign Steven Yoneko on both boxes. Yes, sir.
00:16:38
Speaker
okay and then initial we will yeah initial will last
00:17:06
Speaker
Okay, and then initial we will. Yeah, initial the last ones.
00:17:28
Speaker
Perfect. Thank you.
00:17:32
Speaker
So let me ask you. So so let's say we've we've got all the taxes filed with her. The IRS calculates what the taxes, penalties, fines, all that should be.
IRS Settlement Options
00:17:43
Speaker
Right. Let's say it came to $50,000. Right. Which is about exactly what it's going to come to. And they say to you, say to me, OK, we want our $50,000 today. Oh, no, roco no, God, no.
00:17:57
Speaker
That's the whole purpose of this. This statement is telling them that you only have, at the end of the month, you only have, and I don't think you have this much, but you only have $379 a month, and that's you and Gloria together. okay that You only have $379 a month left at the end of each month, and I think she's using that to pay her credit cards.
00:18:25
Speaker
um So, the maximum amount that you would have to pay if you did an offer in compromise is $9,000, and I'll give you a copy of this, $9,096. That would be an acceptable offer and in the eyes of the IRS, okay, to settle the debt once and for all. Now, if you can't settle it, if you can't come up with the $9,000, then you would do And I'm sorry, but even though Gloria's got a pair of credit cards out of this, they would want $379 a month in taxes because that's what they think you're about three years. Well, the life of the statue, you know, in perpetuity, 10 years, basically. So I need to come up with nine grand cash.
00:19:13
Speaker
if Well, not not yet. I know, but I mean at some point I'm going to have to have a check. I can't break it up into smaller payments. Well, what you can do is this. If you want me to do a timeline, the timeline is, um, basically.
00:19:29
Speaker
but Okay. So it's $9,096. They need a 20% down payment. Okay, nine, oh, nine. Now this is after, let's say we do it off. Let's say um we get all these things filed. So let's just say, um let's say things are filed by October 31st, 2014. Let's say we submit an offer by November 30th, 2014.
00:20:06
Speaker
They will probably accept that offer, let's say, no later than May 31st, because it takes them about six months, sometimes quicker, 15. Then within 30 days, you'll have to come up with the 20%. So by June 15th? Yeah, I think so.
00:20:33
Speaker
9096 times 0.2. yeah is 1819. So then you take 9096 minus 8. This is with Dow payment with the offer. Then there's no more money due. And then, okay, so then that Yeah, let's say June 30th, 2015. There's no more money due until they approve the offer. And sometimes, well, let's say they approve it. Okay, let's say they approve it. So it's approved here. who Okay, so then you'll need, this'll be um June 30th, 2015. Then you can take the balance.
00:21:14
Speaker
$7,300 yeah well let me just do it and since I have a calculator so it's 9 0 9 6 minus 1 8 1 9 is right 72 7 7 so you divide that by five months you have five months to pay it the balance five months yeah 1 2 3 4 five So then in July, August, September, October, November. So you divide that by 5. That's say 1455.
00:22:02
Speaker
that's That's your cash flow requirement. Let me just
00:22:11
Speaker
I can't remember. There's not two C's in your name. Two N's. Y-E-N-N-A-C-O. Pronounced Yanaco. Yanaco. Just as a spell, Yanaco, yeah.
00:22:27
Speaker
um
00:22:43
Speaker
And this was all 2015, of course. Accepted first of five payments due.
00:23:11
Speaker
Actually, I need to roll that back. Roll that. Well, I need to roll that back a month. But anyway, so I'll just give this to you. That's close enough. But that's it. That's the way I'm going to just take a coffee. sorry number one i That's about the way it'll shake out. OK. Yeah.
00:23:46
Speaker
Okay.
00:23:49
Speaker
And that's right on the form. You'll see that. It's all spelled out on the form. In other words, this payment schedule is like the third or fourth page of the form. And you'll see it, and that's what you agree to. It's all black and white. So, I mean, unless you want to pay $379 for 10 years. No, this thing's to be aware of. Once a month for 10 years. I mean, that's 120 payments. So,
00:24:15
Speaker
um three seventy nine six times all the twenty that's forty five grand That would basically be the corpus of the tax because when you get the bill, it's going to probably just hold your holds your hold your water because it's going to probably be double with the penalties and interest. So that's why, you know, ah but if this is the bottom line, I don't worry about anything else.
00:24:46
Speaker
It'll all be eliminated with the offer. That's the safest bet to go. It's really the best deal because the government doesn't want to chase people. They always spend resources chasing people. that that The IRS's job is to clear the books.
00:25:01
Speaker
and
00:25:04
Speaker
This is a good deal. You know, they get something rather than nothing and they don't have to waste resources chasing you. It's a good deal for you. I came to them. Is that better in their eyes also? than them yeah filing me of course And then for five years though, you've got to file and pay on time or they revoked the offer and put you back to square one and you'll be back to the 50,000. We'll be doing the taxes after that. So, exactly good shape yeah so um,
00:25:32
Speaker
Oh, by the way, incidentally, this 20% is due when you submit the offer. So you might wanna, that'll be due in November when we submit the offer, okay? I mean, I'm just assuming that this is the way to go for you, because in my mind, it's the only other alternative, unless they say you're not collectible at all, but but I think you might be, you said you're doing better, so.
00:25:59
Speaker
I think you're probably collectible. Let me give you a copy of this. Or did I send you a copy? You did. Okay, then you have it already. But this year is all I need. But I do have, I'm glad you, so so I need this in November. Yeah, you'll need 18, 19, 30th approximately. Yeah, depending on you know when we submit it. Because the other alternative is to double the amount of the offer would be 18,000 and then pay them 18,000 divided by 24 months We already talked about this. Those are going to be $2,750 a month. Yeah, that would be more than that. $18,000 divided by $24,000. That is $750,000 a month. But you've got to pay it month in and month out. And then if they reject the offer, you're out that money. And I'd rather do that. Yeah, that's right. Because then you're only out the $18,000, $19,000. And yeah me they'll let us know, OK?
00:26:58
Speaker
So I'll get this off to her. Now, did you bring any, you didn't bring any paperwork as far as household expenses? No, I just told you I had some cash. My wife is working on that. I can have that for you next week as well. Because I will tell you this, that part of the checklist of this thing, it says, that's why I asked you for it. It says, well, I do have some of the stuff. I have her pay stub.
00:27:24
Speaker
Um, retirement accounts. Do you have, did do you have any bank statements? Yeah, we need those. Um, I would need the judgment thing. I mean, they want all that stuff attached. I'll just say pending yeah pending, um, from client.
00:27:57
Speaker
serious. Right.
Paperwork and Future Steps
00:28:00
Speaker
Okay. And that way she can make a checklist, right? And say, Oh, this guy I don't have to chase now. We're going to get going with him. Right. Right. Right. Right. Right. Right. Right. Right. Right. Okay. Fine. So you' old you're all we're, we're, we're square now. So get me that chart.
00:28:19
Speaker
You know, the chart I need. Yeah, I need this chart. Yeah. I don't even know what I did with it. He gave it to me. I have it. Yeah, but I needed to keep a copy of it. I don't know what I did with my phone. Oh, I know. Maybe it's in. Yeah, this chart, I need more origin of this chart. And I need the paper. Well, you want me to write it down? No, I have it all.
00:28:46
Speaker
You already sent it to me in the mail. I call it the revenue chart and household bills. Yep. I'll bring you original. Can I give you foot can i bring you photocopies if you want to see the originals yourself? No, you can bring photocopies. Okay.
00:29:04
Speaker
Because I can photo of it, copy them at the house, and I can ring them with me. Or mail them to you. If you want to mail them, that's fine. Mail them or fax them. But the next time I come, I'll bring you some money, so... thats Yeah, no, that helps, too. Okay. So I can't get started until I get paperwork. Okay. I don't know if you need even that email to say, hey...
00:29:25
Speaker
I signed the agreement. I'm representing him now. Yeah. So what I'll do is I'll i'll put the the full 1080 on there. It's like a pre-billing and then I'll work against it on the money you pay me. Fantastic.
00:29:39
Speaker
All right, my friend. Thank you. All right. In my mind, I'm another step further. That's what I'm trying to move it all. It doesn't always work perfectly. No time. Not always in the same chair you're looking for, but I'm trying to move forward. I'm trying to do a lot of things. I have two kids. I just sent to college a week ago across near fortune. You know, it eats it all up. I know. All right. So, but they're doing fantastic. So that's awesome.
00:30:08
Speaker
okay get a flu shot get a flu shot i always do good thank you a Doctor next week, good man, good man. See you Charlie Brown, bye bye.