Do I Have to Close My Business to File an Offer-in-Compromise?
Business owners thinking about filing an Offer-in-Compromise often want to know if they have to close their business in order to file their offer.
This is our Morning Coffee Series, and we’re going to cover that question today.
Do I have to close my business to file an Offer-in-Compromise?
The answer is NO. You do not have to close your business.
An Offer-in-Compromise can be filed for an existing business.
However, you do control the choice of whether to close your business or keep it open.
Sometimes closing a struggling business can be more beneficial, especially when filing an Offer-in-Compromise.
These are some of the possible reasons why closing your business may be the best option:
- There is no realistic expectation of the business’s survival.
- You are considering opening a new business with different ownership, different services, or different operations.
- Your closing business’s offer could be significantly less than if you remain in business.
One benefit of closing your business is that part of your business’s tax liability could automatically be uncollectable.
However, be careful.
Remember this – the IRS or state government could hold you personally liable for some portions of your business tax liability.
If you close your business, that liability may not go away.
We’ve still got a lot of questions to cover.
And we’ll do that throughout our Morning Coffee Series.
Stay tuned!