Thursday, October 23, 2008

OIC? You have a better chance of getting a foul ball at a baseball game

I get incensed by the false advertising of companies that state that they can get you "pennies on the dollar"- as if it was dependent on the skill of that practitioner. Another false advertising claim by these companies is the statement, "it is your last chance to get rid of your tax debt." This one could not be farther from the truth. These companies are referring to the IRS Offer in Compromise program. In fact, this program has been with the IRS for about 60 years, with no end proposed by Congress, the US Treasury, or the IRS.

Now, your chances of an Offer- Doubt as to Collectibility (this is the one that they are advertising), are quite small. In fact, by conservative standards, the chances are about 1 in 714 for those who owe taxes.

Compare that with your chances of catching a foul ball at a baseball game: 563 to 1

The fact is that the Offer in Compromise is a rarely used form of resolving your debt. There are many other options you need to explore with a competent tax professional.

1 comment:

Brian Watkins said...

Great post all around. I like your baseball analogy—complete with stats and all.

With enough of these sorts of articles out there, one can only hope the general public starts to wise up about what is probably one of the biggest exaggerations in finance. There are all kinds of predatory firms out there in an industry already full of skeptical customers; makes it hard to be one of the "good guys" and be taken seriously.

Keep up the good work!

Brian Watkins
Tax Solace