Offer in Compromise

Offer in Compromise for Construction Contractors

Construction work means big payments, big expenses, and big tax obligations. An Offer in Compromise could help you settle for less.

Check If You Qualify

Why Construction Contractors Face Tax Problems

Construction contractors deal with large lump-sum payments, expensive equipment, and seasonal work. A big project payment can trigger a huge tax bill, while material costs and equipment maintenance drain cash reserves. Add subcontractor payments and the complexity of job costing, and taxes often get pushed aside.

The good news? An Offer in Compromise lets you settle your tax debt for less than you owe. The IRS looks at your Reasonable Collection Potential (RCP)—what they think they can realistically collect from you based on your income, expenses, and assets.

Common Tax Issues for Construction Contractors

Lump Sum Payments

Large project payments create big tax obligations all at once.

Equipment Costs

Tools and equipment eat into cash that should go toward taxes.

Subcontractor Issues

1099 obligations and proper classification create compliance headaches.

Seasonal Work

Slow winter months make it hard to pay taxes from summer earnings.

How Offer in Compromise Works for Construction Contractors

OIC Advantages for Construction Contractors:

  • Variable income can lower your "future income" calculation
  • Business expenses reduce your disposable income
  • Equipment and tools may have minimal equity value
  • Economic downturns in your industry support hardship claims
  • Settle for a fraction of what you owe

What You'll Need:

  • All tax returns filed (we can help with this)
  • Current on estimated tax payments
  • Detailed income and expense documentation
  • Financial records for the past 12 months
  • $205 application fee + 20% of offer amount

Other Options for Construction Contractors Tax Debt

Installment Agreement

If you don't qualify for an OIC, a payment plan lets you pay your full debt over time in manageable monthly amounts.

  • Stops collection actions
  • Predictable payments
  • Easier to qualify

Currently Not Collectible

If you can't afford any payments right now, CNC status pauses collections until your situation improves.

  • No payments required
  • Collections paused
  • Time to stabilize

Penalty Abatement

If this is your first tax issue or you have reasonable cause, you may qualify to have penalties removed.

  • Reduce total owed
  • First-time relief available
  • Reasonable cause options

Not sure which option is best? Compare OIC vs Installment Agreement

Ready to Resolve Your Tax Situation?

Take our free 2-minute assessment to understand your options.

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