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Tax relief guide

Understand the numbers behind your result.

Our calculator uses the published IRS pre-qualification framework and Form 433-A (OIC). Every result is an educational estimate that needs verification.

Tax Relief Tool · Updated September 30, 2026 · Editorial policy

Six steps, with the calculation explained

  1. Eligibility. Review open bankruptcy, required returns, estimated payments, employer deposits, and whether the tool supports the taxpayer’s situation.
  2. Household. Enter debt, state, county, household size, ages, offer type, and any verified collection timeline.
  3. Assets. Estimate available equity, with the worksheet adjustments described below.
  4. Income. Add monthly household income, including wages, benefits, distributions, net business and rental income, and support.
  5. Expenses. Apply national allowances and county or regional limits, then include entered necessary expenses.
  6. Results. Compare asset equity and future income with the tax balance and explain other possible resolution paths.

Expense standards used

The data snapshot uses IRS Collection Financial Standards effective June 29, 2026, checked September 30, 2026. Housing data covers the 50 states and D.C. Counties are selected directly; a ZIP code is unnecessary because it can cross county boundaries.

Food, clothing, and essential expenses use the national household allowance. Health care uses $90 per person under 65 and $163 per person age 65 or older. Actual housing costs are limited to the county allowance for the household size. Five-person housing limits apply to larger households in this basic screen.

Vehicle ownership costs use the lesser of actual payments or $703 per eligible vehicle. Operating costs use the lesser of actual spending or the applicable IRS metropolitan or regional cap. A non-joint offer normally receives one vehicle expense allowance; a joint offer may receive two. Without a vehicle, the public transportation allowance is $220. Necessary exceptions require verification.

Asset adjustments

The tool excludes $1,000 from combined cash and bank balances. It applies an 80% valuation to the separately entered home, retirement accounts, and first two vehicles, then subtracts secured loans. It deducts $3,450 from the first vehicle’s adjusted equity, and from the second for a joint offer. Negative equity does not offset other assets.

For additional properties or vehicles, the user enters the sum of each asset’s adjusted equity. Investment and digital asset entries use net realizable amounts without a blanket 80% discount. Cash-value life insurance is entered net of policy loans. Personal effects and valuables receive the Form 433-A (OIC) $11,980 deduction. These are worksheet estimates; the IRS can adjust valuations and exclusions.

Disposable income and collection potential

Monthly disposable income is gross household income minus estimated allowable expenses, floored at zero. The ordinary lump-sum basis adds assets to 12 months of disposable income; the periodic basis uses 24 months. A shorter entered collection period limits the corresponding multiplier.

The full-payment screen compares debt with assets plus income over the entered collection period. If the deadline is unknown, it uses a clearly labeled 120-month illustration and flags uncertainty where that changes the likely result. It does not infer a collection deadline from a tax year or calculate future interest and penalties.

Important limits of this tool

This is an independent implementation of published guidance, not the IRS’s software or an exact reproduction of its internal determinations. It does not review transcripts, verify data, calculate low-income certification, or model all state-tax allocations and exceptions. Non-liable household members, self-employment, serious hardship, multiple assessment deadlines, business entities, and foreign or territory addresses need individualized analysis.

The result is not a submitted offer, payment agreement, or legal opinion. A submitted offer must exceed $0. Special-circumstance and disputed-liability cases can have different analyses, even if the general screen suggests full payment.

Sources & further reading

Sources checked September 30, 2026. Tax rules and allowance amounts can change.