PitBullTax Software just released the new OIC Forms 433-A (OIC) and 433-B (OIC) along with the updated Form 656. After several months of hard work we are happy to announce that the OIC package is now fully updated with the most current IRS revisions and is available for immediate use. A big “Thank You” to our valued licensees for their patience and understanding expressed during this complex programming and development process.
As you may be aware, the IRS released a simplified OIC package which requires submission of different forms for an Offer in Compromise resolution case: Form 433-A (OIC) and Form 656 for an individual taxpayer offer, and Form 433-B (OIC) and Form 656 for a business taxpayer offer in compromise.
The newly released IRS Forms 433-A (OIC) and 433-B (OIC) have many similarities with the existing Forms 433-A and 433-B, Collection Information Statements, which remain in use for purposes other than OIC related resolutions. Therefore, to ease the input of the information into the new forms and to save preparation time, PitBullTax Software has combined the Data Entry of Form 433-A with Form 433-A (OIC) and Form 433-B with Form 433-B (OIC). Some sections of existing Forms 433-A and 433-B are not required for input in the new Forms 433-A (OIC) and 433-B (OIC), and it is specifically indicated so in the Data Entry area.
While data input for Forms 433-A and 433-A (OIC) is combined, final IRS forms produced in the software are different. If Data Entry of Form 433-A / 433-A (OIC) indicates a purpose for form preparation as an Offer in Compromise, you will see final IRS Form 433-A (OIC) in the output. If you selected Installment Agreement or Currently Not Collectible status as a main purpose of Collection Information Statement, then existing Form 433-A will be printed and displayed. Switching between resolution purposes is very simple and requires just a change of radio button in the Data Entry of the “Monthly Living Expenses” section.
Similarly, we have introduced the same concept for the combined Data Entry of Forms 433-B and 433-B (OIC). On the first page of Data Entry for the Form 433-B / 433-B (OIC) we have added a new question: “Are you preparing an OIC package for this client?”. If you select “Yes”, the final output will show IRS Form 433-B (OIC). Otherwise, the existing Form 433-B Collection Information Statement for Businesses will be produced and printed.
Let us briefly summarize major changes in relation to the new OIC package:
1. New Form 433-A (OIC) combines previously used Form 433-A and Worksheet to Calculate Offer Amount. Therefore, we have eliminated the Worksheet from the Data Entry. The Offer amount is calculated on the fly based on your entries. The best news is that you are no longer required to provide information on how many months are remaining on the 10-year collection statute in order to calculate the offer amount.
2. The IRS no longer allows a $7,900 exemption on Furniture and Personal Effects for Individual offers. Please make sure to double check your offers before submission.
3. The exemption amount for self-employed individuals has been changed to $4,180 and covers not only books and tools, but all Schedule C assets. All other types of businesses are allowed a $4,120 exemption on business assets, only a $60 difference with self-employed individuals.
4. The Quick Sale Factor for Retirement Plans such as IRA, Roth IRA, Keogh, 401(k), SEP, SIMPLE and others, has been lowered to 70% from the previous 80%. All other assets remain with the IRS default of 80%, but can be lowered as well based on individual case circumstances.
5. Credit card information and available credit information is no longer required with the submission of an OIC package!
6. Now there are only two payment options available in the Offer in Compromise, intuitively called by the IRS Payment Option 1 and Payment Option 2. The first is paid within 5 months and the second is paid in more than 5 months.
7. Form 656-A Income Certification for Offer in Compromise Application Fee and Payment and Form 656-PPV Periodic Payment Voucher are now incorporated into the new release of Form 656. Therefore, we have removed both of these forms from the Data Entry. Income Certification is automatically determined by the software and prompts you whether or not your client is required to submit a 20% advance payment and the $150 application fee.
8. New Form 433-B (OIC) now has an offer amount calculation mechanism. No more worries on how to calculate the offer amount for a business client, it’s all programmed in the PitBullTax Software. Just complete Form 433-B (OIC).
9. PitBullTax Express Evaluation (PE²) tool has been updated as well to reflect 2 payment options for an OIC and changes in exemption amounts on individual and business assets.
We hope you will enjoy the enhanced features of PitBullTax Software which will save more time in handling your resolution cases. For any questions on the new updates or for technical assistance, please call our toll free number 1-877-474-8285 Monday through Friday 9am – 6pm EST.
In the month of August, PitBullTax Software will attend two major events, the Annual Conference of NAEA in Las Vegas, NV and the Annual Conference of NATP in St. Louis, MO. When attending these events, please stop by our booth for an in-depth demonstration and training on the software features as well as for show discounts on new orders and renewals. Posted at 07/29/2011 01:01:09 PM