Sometimes a taxpayer whose Offer in Compromise has already been accepted by the IRS needs to submit a revision to the original agreement. This can occur in a variety of situations, one that is common however, is a taxpayer inability to pay the balance on a tax return that is filed in years following the acceptance of the Offer in Compromise.
If the taxpayer was unable to pay and therefore neglected to submit a revision, the IRS would classify the Offer in Compromise as being in default and proceed to try and collect on the whole debt. Whenever a taxpayer submits an Offer in Compromise to the IRS, they agree to be in full compliance with the IRS for the duration of their agreement or they will be subject to collection efforts and there agreement taken away.
Submitting Revised Offer in Compromise
According to the IRS, the revised Offer in Compromise needs to be submitted in writing but another Form 656 (Offer in Compromise Agreement) is not required from the taxpayer. The taxpayer is also not required to submit a 20% payment or periodic payment along with the revised proposal.