Offer in Compromise
An offer in compromise (OIC) is a proposal to settle your tax bill for less than the full amount due.
We can consider offers in compromise from individuals and businesses for the following reasons:
- Waiver of penalties over $2,000 if extenuating circumstances kept you from filing or paying your taxes on time
- You may not be liable for the amount assessed (doubtful liability)
- You are currently experiencing financial hardship, and can show that you are not able to pay the full amount you owe (doubtful collectibility)
How to request an offer in compromise
Offer in compromise forms are required. Letters alone will not be considered without completed offer in compromise forms.
For requests for relief based on doubtful liability or for waiver of penalty, submit the required forms, and include all required documentation as detailed in the instructions:
For requests for relief due to financial hardship (doubtful collectibility), submit a completed offer package, including all required forms and supporting documentation:
You may be required to include a $50 administrative fee. See the instructions for complete details.
Mail your required forms and all supporting documentation to:
Virginia Department of Taxation
PO Box 2475
Richmond, Virginia 23218-2475
We will consider your offer based on all available information. If the Tax Commissioner accepts your offer, we will remove any amounts waived from your bill. If your offer is not accepted, you must pay the balance of the bill in full.
See the Taxpayer Bill of Rights for more information.