Individuals owing back taxes and wanting to make the IRS an offer to settle tax debt for less than what they owe will need to fill out IRS Form 433-A (in addition to a Form 656). Information collected on Form 433-A primarily involves your finances: assets, debts, fund resources, household income, and wages.
Each section of the IRS Form 443A asks for details regarding your financial situation, employment status, bank accounts, and so on. For a free step by step evaluation to determine your Fresh Start Tax Relief Program eligibility to submit an offer to the IRS, use the free online system at Wiztax to help you submit an Offer in Compromise.
All of the sections highlighted below are automatically filled out by Wiztax after you complete you free and easy online evaluation.
Guide to Completing IRS Form 433-A OIC
Also referred to as a “Collection Information Statement for Wage Earners and Self-Employed Individuals”, Form 433-A allows the IRS to decide if your OIC has “reasonable collection potential” regarding a past due tax debt owed by you exclusively.
IRS Form 433-A (OIC) Section 1:
Personal and Household Information
This section asks for personal information, name of spouse (if applicable), social security numbers and names of individuals living in your household. You will have to indicate on the form whether you claim a household member as a dependent on IRS Form 1040 or if the household member contributes financially and is not a dependent.
IRS Form 433-A (OIC) Section 2:
Employment Information for Wage Earners
If you or a spouse earn wages and receive W-2s at the end of the year, Wiztax will help you complete Section 2 of IRS Form 433-A. Wages include any W-2 wages plus self-employment income. Don’t worry, Wiztax also guides self-employed individuals in answering additional simple business information questions to fill out Sections 4, 5, and 6 of Form 433-A.
IRS Form 433-A (OIC) Section 3:
Personal Asset Information
You’ll be asked to provide checking, savings, PayPal and online accounts under the line “Cash and Investments: Domestic and Foreign”. The IRS also wants to know if you have any virtual currency. If you have life insurance policies, 401Ks, IRAs or other retirement-type accounts, you will be asked to provide a summary.
Form 433-A Section 3 also requests information about real estate properties you own or are in the process of buying. Residential homes, co-ops, condominiums, time shares and rental properties are all considered assets by the IRS.
IRS Form 433-A (OIC) Section 4:
Self-Employed Information
The IRS designates an individual to be self-employed if they are an independent contractor (sole proprietor) or a member of a partnership (you and only one other person) that operates as a business or trade. If you work part-time (less than 30 hours a week) as an independent contractor, you are considered self-employed by the IRS. If you have a spouse who is also self-employed, you’ll be asked to include information regarding your spouse’s income.
IRS Form 433-A (OIC) Section 5:
Business Asset Information (for Self-Employed)
Self-employed individuals must list all bank accounts, books, equipment, property and vehicles used for business purposes that they own, lease, or rent. You do not need to list personal assets in Section 5 that you already included in Section 3 of IRS Form 433-A OIC
IRS Form 433-A (OIC) Section 6:
Business Income and Expense Information (for Self-Employed)
Information about your business will go in this section. This will include business assets as well as income and expenses.
IRS Form 433-A (OIC) Section 7:
Monthly Household Income and Expense Information
Monthly household income includes you and your spouse’s gross wages, social security benefits, pensions, net rental income (if applicable), child support received and alimony. You will also need to provide amounts for monthly household expenses, such as utilities, mortgage payment, food, clothing, out of pocket health costs, childcare costs and vehicle payments.
IRS Form 433-A (OIC) Section 8:
Calculate Your Minimum Offer Amount
In this section, the IRS wants to know if you wish to place an offer for their five month or less plan or the six-to-24-month payment plan. Don’t worry, after completing the free online evaluation, Wiztax will determine which plan you qualify for and show you your monthly payment. You won’t have to do any of the calculations yourself.
Get Help with Filing Form 443-A (OIC) Using Wiztax
Don’t be intimidated by the length and complexity of IRS Form 433-A. Just start using our free online system that will help you fill out Form 433-A quickly and correctly. We only ask the questions necessary to calculate your offer and complete the corresponding forms. Before you sign and file, a Wiztax Expert will review everything with you for accuracy, including Form 433-A (OIC).
Start for Free with Wiztax today and Wiztax will calculate and display you Offer amount instantly!
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