Letter 3220C: Offer in Compromise Acceptance

The Letter 3220C is sent by the IRS to inform taxpayers that their offer in compromise has been accepted. An offer in compromise is a program that allows taxpayers to settle their tax debt for less than the full amount owed, based on their financial situation and ability to pay. Acceptance of this offer means the IRS has agreed to the proposed settlement amount.

Key elements of Letter 3220C:

• Offer Accepted: The letter confirms that the IRS has accepted the taxpayer’s offer to settle their tax debt for a reduced amount. This is a formal agreement between the IRS and the taxpayer.
• Payment Terms: The letter will outline the terms of the offer in compromise, including how much the taxpayer is required to pay and the deadline for making the payment. The payment schedule may vary depending on the terms of the agreement.
• Obligations Going Forward: In addition to the payment terms, the taxpayer must meet certain obligations to remain in compliance with the agreement. This includes filing all future tax returns on time and making any required payments. The letter will explain these obligations.
• Consequences of Default: If the taxpayer fails to meet the terms of the offer in compromise, the IRS may rescind the agreement and require the full amount of the original debt to be paid. The letter will provide instructions on how to avoid defaulting on the agreement.

The acceptance of an offer in compromise, as detailed in Letter 3220C, provides a significant opportunity for taxpayers to resolve their tax debt for less than they owe, but it requires strict adherence to the terms of the agreement.