Letter 2604C: Rejection of Offer in Compromise

The Letter 2604C is sent by the IRS to inform taxpayers that their offer in compromise (OIC) has been rejected. An offer in compromise allows taxpayers to settle their tax debt for less than the full amount owed, but the IRS may reject the offer if the taxpayer does not meet eligibility criteria or if the offer is deemed insufficient.

Key aspects of Letter 2604C:

• Reasons for Rejection: The letter will explain why the offer in compromise was rejected, such as the taxpayer’s ability to pay, insufficient documentation, or failure to meet other criteria.
• Appeal Options: Taxpayers have the right to appeal the rejection if they believe the decision was made in error. The letter provides instructions for how to appeal and the timeframe within which the appeal must be submitted.
• Submitting a New Offer: If the taxpayer chooses not to appeal or if the appeal is denied, they may submit a new offer with revised terms. The letter includes guidelines for resubmitting an offer in compromise.
• Next Steps: Taxpayers must take action to either appeal the decision or pay their tax debt, as failure to resolve the issue may lead to more aggressive collection actions by the IRS.

The Letter 2604C provides important information about why an offer in compromise was rejected and offers taxpayers the opportunity to appeal or submit a revised offer.