Form 656-A - Income Certification For Offer In Compromise Application Fee And Payment
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2Offer in Compromise Application Fee and Payment Worksheet
This worksheet should only be completed if you are requesting an exception to the $150 application fee and
payment(s) because of your income.
It is important that you use the current version Form 656 (Rev. 03-2009), Offer in Compromise, and the
(Rev. 1-2008) versions of Forms 433-A, Collection Information Statement for Wage Earners and Self-Employed
Individuals, that are included in this package.
Individuals whose income falls at or below levels based on IRS Offer in Compromise Low Income Guidelines are not
required to pay the application fee or the required initial payments. This exception only applies to individuals; it does not
apply to other entities such as corporations or partnerships. You should use the worksheet below to determine if you meet
the eligibility requirements.
If you are an individual, follow the steps below to determine if you must pay the application fee and any 20% payment
or first initial installment with your Form 656, Offer in Compromise.
1. Family Unit Size_____. Enter the total number of dependants (including yourself and your spouse) listed in Section 1
of Form 433-A, Collection Information Statement for Wage Earners and Self-Employed individuals. Transfer this num
ber to Form 656-A, Item 5.
2. Total Household Monthly Income_____________. Enter the amount of your total household monthly income from
Section 4, Line 32, “Total Income”, of the Form 433A, Collection Information Statement for Wage Earners and
Self-Employed Individuals. Please see Page 4 under Step Two, item 5, for a definition of total household income.
Transfer this number to Form 656-A, Item 6.
If you are self-employed you must comply to footnote number 6 instructions regarding business deductions and
treatment of depreciation before you compute the Net Business Income amount for line 82, and carry it over to
Form 433A, section 4, line 23 to Form 656-A, Item 6.
3. Compare the information you entered in items 1 and 2, above, to the IRS OIC Low Income Guidelines table below.
Find the "Family Unit Size" equal to the number you entered in item 1. Next, find the column which represents where
you reside (48 Contiguous states, DC …, Hawaii or Alaska). Compare the “Total Household Income” you entered in
item 2 to the number in the row and column that corresponds to your family unit size and residence. For example, if
you reside in one of the 48 contiguous states, and your family unit size from item 1 above is 4, and your total house
hold monthly income from item 2 above is $3000, then you are exempt from the application fee and payment because
your income is less than the $4,594 guideline amount.
IRS OIC Low Income Guidelines
Size of Family Unit
48 Contiguous States and D.C.
Hawaii
Alaska
1
$2,256
$2,596
$2,819
2
$3,035
$3,492
$3,794
3
$3,815
$4,388
$4,769
4
$4,594
$5,283
$5,744
5
$5,373
$6,179
$6,719
6
$6,152
$7,075
$7,694
7
$6,931
$7,971
$8,669
8
$7,710
$8,867
$9,644
For each additional person, add
$779
$896
$975
4. If the total household monthly income you entered in item 2 is more than the amount shown for your family unit size
and residence in the monthly IRS OIC Low Income Guidelines table above, you must send the $150 application fee
and any 20% payment or first initial installment with each OIC you submit.
Your check or money order should be made payable to the "United States Treasury" and attached to the front of your
Form 656, Offer In Compromise. Do Not Send Cash. Send a separate application fee with each OIC; do not combine it
with any other tax payments as this may delay processing of your OIC. Your OIC will be returned to you without further
consideration if the application fee and the required payments are not properly remitted, or if your check is returned for
insufficient funds.
5. If the total income you entered in item 2 is equal to or less than the amount shown for your family unit size and residence in
the table above, do not send the application fee or the required payments. Sign and date Form 656-A, Income Certification
for Offer in Compromise Application Fee and Payment. Attach the certification to the front of your Form 656.
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