7.3.2 Bases for OIC

An OIC may be submitted on the basis of doubt as to collectability, doubt as to liability, or effective tax administration.1 Most offers are submitted for doubt as to collectability. This generally requires a showing that the taxpayer cannot afford to pay the liability and does not have assets that can easily be liquidated to pay the liability and that this situation is permanent. Many elderly and disabled persons with limited income are eligible to receive an OIC on this basis. 

• 1I.R.C. § 7122.