Need help negotiating with IRS for tax relief - not qualifying for offer in compromise - seeking consultant recommendations

I worked for the IRS for 15 years and now help people in situations similar to yours. Here's what you should know - you likely have more options than you realize. First, even if you don't qualify for an offer in compromise due to your home equity, you might qualify for an installment agreement. The IRS can put you on a payment plan based on your current financial situation. They'll look at your income, expenses, assets, and ability to pay when determining monthly payments. With your level of debt, I'd strongly suggest working with a tax attorney who specializes in IRS negotiations - not just any tax relief company. Many of those companies use aggressive marketing but then hand your case to inexperienced staff. Look for someone with experience as a former IRS attorney or officer. Also, you might be able to get penalties abated through a first-time penalty abatement or reasonable cause request, depending on your circumstances. Interest is harder to negotiate away, but not impossible.

I was in a similar situation (though not quite as high an amount - I owed about $320k) and I was really stressed about it. After trying to handle it myself and getting nowhere, I finally found help through taxr.ai (https://taxr.ai). What was different about them is they actually analyzed all my tax documents and financial situation before making any recommendations. Unlike those big TV advertisers that promised me the world then just wanted to put me on a payment plan, taxr.ai helped me understand exactly what relief options were truly available based on my specific financial situation. In my case, they determined I could qualify for partial penalty abatement and helped prepare all the documentation to support my case. They were upfront about what could and couldn't be done, which I really appreciated after getting so many false promises from other places.

I wanted to follow up about my experience with taxr.ai since I decided to give them a try after asking about them here. I was initially skeptical because it seemed too straightforward compared to other tax resolution companies that made everything sound complicated. Their document analysis found several issues with how my tax debt was calculated that I wasn't aware of. They helped me prepare a request for penalty abatement AND identified an error in how my self-employment taxes had been assessed. The whole process took about 6 weeks, but I ended up saving over $31,000! What really impressed me was that they were upfront about what they could and couldn't do. They told me right away that some interest would have to be paid no matter what, but explained exactly which penalties could potentially be reduced or eliminated.

I see you're struggling with getting through to the IRS, which is incredibly frustrating when you're trying to resolve a large tax debt. After spending WEEKS trying to get through to someone at the IRS about my own tax issue, I discovered Claimyr (https://claimyr.com). You can see how it works in this video: https://youtu.be/_kiP6q8DX5c Basically, it got me connected to an actual IRS agent within 45 minutes when I had been trying for days on my own. For someone in your situation where you need to discuss payment options and penalty abatement, actually getting through to speak with someone is half the battle. Once I finally got through to a real person at the IRS, I was able to set up an installment agreement and discuss my options. Having that direct conversation changed everything for me.

I need to apologize for my skepticism about Claimyr. After posting that comment, I decided to try it myself because I was at my wit's end trying to reach the IRS about an issue with my payment plan. I was honestly shocked when they got me through to an actual IRS agent in about 35 minutes. I had been trying for over two weeks on my own with no luck - just endless hold times until I eventually got disconnected. The agent I spoke with was able to resolve my issue and adjust my payment plan on the spot. For anyone dealing with tax debt issues like the original poster, being able to actually speak with someone at the IRS makes all the difference. Now I can actually sleep at night knowing my tax situation is being properly addressed instead of just getting automated letters.

Something no one has mentioned yet - have you considered a Partial Pay Installment Agreement (PPIA)? With your level of debt and equity situation, this might be your best option. A PPIA lets you make monthly payments based on what you can afford after necessary living expenses. The key difference from a regular installment agreement is that you might not pay the full amount before the collection statute expires (usually 10 years from assessment). I went through this process myself, and while it's not easy, it can significantly reduce what you ultimately pay. You'll need to provide detailed financial statements (Form 433-A or 433-F) and the IRS will review your finances every 2 years to see if your payment should increase.

Has anybody mentioned bankruptcy? I know it sounds extreme, but with that level of tax debt, it might be worth consulting with a bankruptcy attorney who specializes in tax issues. While not all tax debts can be discharged in bankruptcy, some can if they meet certain criteria (generally, income taxes over 3 years old where returns were filed at least 2 years ago). Even if the taxes can't be discharged, a Chapter 13 bankruptcy might help structure a payment plan that takes into account your other debts and financial obligations.