An offer in compromise allows you to settle your tax debt for less than the full amount that is owed.  It can be a viable solution for someone who cannot pay their full tax liability, or by doing so will create a financial hardship.  The IRS usually approves an offer in compromise when the amount that is being offered represents the most that they can collect in a reasonable period of time.  It is usually used as a method of last resort when all other collection methods have been exhausted, and they realize that they cannot effectively recover the entire tax debt. 

If you are interested in learning more about an offer in compromise you should consult a reputable tax professional.  Many tax resolution companies sell an offer in compromise as a service; however, not everyone is a good candidate or can will be approved.  As a consumer you will need to do your homework, look at BBB ratings as well as Rip-off Reports.  Once you feel secure that you are working with a qualified tax professional that has your best interests in mind, they will guide you through the forms (433-A for individuals or 433-B for businesses.)  There is also a non-refundable application fee of $150 and the process can be very time consuming.

If you are serious about an offer in compromise, consult professional help.  The process can be long and any mistake made can forfeit your application.  A tax professional submits offers daily and will fully understand the process.