Offer in compromise method and system
First Claim
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1. A tax resolution system to assist a taxpayer or tax professional in identifying and implementing solutions to tax delinquency problems, comprising:
- at least one computer;
an offer in compromise software application executed on the at least one computer to calculate a reasonable collection potential (RCP) to enable the taxpayer to determine what, if any, benefit could result from an offer in compromise, wherein the RCP is a measure employed by the Internal Revenue Service (IRS) of the capacity of a taxpayer to pay current and past due taxes based on calculations comprising;
a) the net equity in the taxpayer'"'"'s assets, b) income of the taxpayer available to pay taxes after allowing for allowable expenditures, and c) income that will become available after existing loans of the taxpayer are paid off;
wherein the taxpayer or the tax professional can make adjustments to the taxpayer'"'"'s finances to adjust the RCP to plan ahead and further increase the likelihood of achieving acceptance of an offer in compromise with the IRS; and
document creation tools to create one or more documents relating to an offer in compromise application.
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Abstract
A tax resolution system and method are disclosed for identifying and implementing solutions to tax delinquency problems. A taxpayer who is delinquent is guided to provide pertinent data and make adjustments to be analyzed to formulate an offer in compromise to resolve tax delinquency problems or plan a future tax strategy.
74 Citations
16 Claims
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1. A tax resolution system to assist a taxpayer or tax professional in identifying and implementing solutions to tax delinquency problems, comprising:
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at least one computer; an offer in compromise software application executed on the at least one computer to calculate a reasonable collection potential (RCP) to enable the taxpayer to determine what, if any, benefit could result from an offer in compromise, wherein the RCP is a measure employed by the Internal Revenue Service (IRS) of the capacity of a taxpayer to pay current and past due taxes based on calculations comprising;
a) the net equity in the taxpayer'"'"'s assets, b) income of the taxpayer available to pay taxes after allowing for allowable expenditures, and c) income that will become available after existing loans of the taxpayer are paid off;wherein the taxpayer or the tax professional can make adjustments to the taxpayer'"'"'s finances to adjust the RCP to plan ahead and further increase the likelihood of achieving acceptance of an offer in compromise with the IRS; and document creation tools to create one or more documents relating to an offer in compromise application. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 14, 15, 16)
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9. The system of 1 wherein the adjustments are based on gifting highly appreciated assets through a charitable remainder trust.
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10. The system of 1 wherein the adjustments are based on prepaying housing and utilities bills so as not to add to the taxpayer'"'"'s RCP.
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11. The system of 1 wherein the adjustments are based on using a discount rate on the taxpayer'"'"'s future income and expenses.
- 12. The system of 1 wherein the adjustments are based on the taxpayer buying at least one of a) personal assets comprising furniture and clothing and b) tools for the taxpayer'"'"'s business, which the IRS exempts a given amount and the taxpayer can value at a low valuation.
Specification