IRS offer in compromise rejected: build the response record
If the IRS formally rejected your offer in compromise, you ordinarily have 30 days from the date on the rejection letter to request an appeal. The IRS appeal instructions allow Form 13711 or a separate signed letter containing the required information. Send the request through the office that issued the rejection.
First confirm what the IRS actually decided. A returned offer, a request for more information and a proposed increase in the offer amount do not all use that rejection-appeal route. Keep the dated decision, submitted application, IRS financial analysis and proof of your response together.
Identify the decision before choosing a response
Use the complete letter and your contact history to distinguish these situations:
If the table is clipped, scroll sideways. Use arrow keys when focused.
| What happened | What to establish |
|---|---|
| The examiner requested information or discussed a higher offer | What remains under consideration, the requested response and its due date |
| A written rejection was issued | Its date, stated reasons, affected taxpayer and periods, and appeal instructions |
| The offer was returned | The return reason, whether you dispute it, and any applicable reconsideration or new-application instructions |
| An offer was withdrawn | What withdrawal was recorded and the written acknowledgment or other closing documents |
| The offer concerns an existing CDP or equivalent hearing | Who has jurisdiction and what that Appeals proceeding requires |
A return can happen after an offer was accepted for processing and investigated. It does not always mean the IRS never examined the application. The current offer FAQs distinguish returned and rejected offers and describe different next steps.
An offer already being considered through CDP or an equivalent hearing needs its own procedural review. The Collection manual says the offer unit cannot issue an ordinary rejection letter when a CDP/EH hearing request is open in Appeals. Preserve that case’s contacts and notices rather than assuming another Form 13711 request is required.
Preserve the appeal request and its sending evidence
The Collection Appeals Program covers different collection actions. Its Form 9423 is not a substitute for requesting an OIC rejection appeal.
The ordinary rejection period runs from the dated letter. Do not restart it from the day you opened the envelope, received the original application acknowledgment or discussed a different offer amount.
The rejection-appeal procedures in IRM 5.8.7, section 5.8.7.7.5, distinguish receipt from timely mailing. USPS or a designated private delivery service can qualify for the timely-mailing rule. A package sent through another service does not establish timeliness merely because you have a tracking number. Weekend and legal-holiday rules can also matter.
Record the letter date, applicable instructions, sending method, postmark or transmission time, destination and actual receipt information. Preserve any applicable postponement facts for review. This guide does not determine a personal last filing day.
Confirm the destination and permitted method
Mailing instructions point to the office that sent the rejection, rather than a general Appeals address. The manual also describes secure messaging, the IRS Document Upload Tool, fax and hand delivery. Confirm the permitted method and destination with the handling office before relying on an electronic channel. The sender’s time zone matters for the electronic submissions described in the manual.
Retain an identical request packet and the evidence showing how and where it was sent. An internal IRS practice of holding a rejected case for another 15 calendar days to receive and associate mail is not an extra 15 days for filing.
Additional evidence does not replace an appeal
Sending financial records or increasing an offer does not itself request an appeal or extend the period. If you want Appeals review, make that request clearly through the applicable procedure.
The manual also says a recognizable request for an appeal should be afforded consideration even if it does not provide or argue every disputed item. Give the best available explanation and evidence, while distinguishing the appeal request from financial material still being assembled. An incomplete argument and an unsigned request are different problems.
Connect each disagreement to the offer records
For a financial offer, compare the material you submitted with the IRS’s Income/Expense Table, or IET, and Asset/Equity Table, or AET, supplied with the rejection. Individuals, including self-employed people, should locate their Form 433-A (OIC); an entity’s application can involve Form 433-B (OIC). Retain Form 656 and its supporting records too.
If a form or worksheet is missing, the IRS appeal page directs you to the person identified on the rejection letter. Ask for the document by name. A general account balance does not explain which income, expense or asset figure produced the rejection.
Create a private issue-to-evidence record for each disputed point:
If the table is clipped, scroll sideways. Use arrow keys when focused.
| Record field | What to enter |
|---|---|
| Decision and scope | The rejection reason, taxpayer, offer and affected periods |
| Submitted information | The item, amount and period shown in your application or supporting record |
| IRS treatment | The corresponding IET/AET amount or the reason stated elsewhere in the letter |
| Type of disagreement | A recording difference, allowance, valuation, future-income assumption or other issue |
| Your explanation | What you believe is wrong and what change you are requesting |
| Supporting evidence | The document, relevant date and the particular fact it establishes |
| New information | What has changed or was not previously considered, with its supporting record |
| Handling and outcome | What was sent, any further request, the response and the written result |
Keep private identifiers and supporting documents securely. This working record does not replace the official appeal request or calculate an offer the IRS must accept.
Separate a recording error from an allowance or valuation dispute
If an income amount differs, compare the source, payment frequency and period used. A pay statement supporting a different wage figure is useful when it explains the particular difference, rather than simply accompanying a general statement that the debt is unaffordable.
An expense difference can involve the applicable financial standard rather than a transcription error. The IRS distinguishes national standards from local housing and transportation standards, and its FAQs describe conditions for deviations where standards would not cover basic living expenses. Actual spending does not automatically establish the allowed amount. Identify the category, applicable standard and evidence for your position.
For an asset dispute, retain the ownership, valuation and loan or encumbrance records relevant to the item. Explain which value or obligation differs from the IRS analysis. Do not treat one percentage reduction as a complete valuation method for every asset or circumstance.
Use the current OIC versions of the forms and the actual item labels. The April 2026 Form 656-B booklet contains the application forms and financial instructions. A financial statement prepared for another collection purpose may not supply the same record.
Address reasons outside the financial tables
Form 13711, Request for Appeal of Offer in Compromise, expressly provides for a future-income disagreement, another reason stated in the rejection letter, and disagreement with economic-hardship or Effective Tax Administration analysis. State the particular issue and attach evidence showing why you disagree.
A higher offer or a corrected calculation does not resolve every possible rejection reason. Keep a dispute about whether the tax itself is correct distinct from a disagreement about ability to pay. The main offer-in-compromise guide explains those grounds and the separate application requirements.
Check signatures, declarations and who is appealing
Form 13711 requires a signature and date. It contains the taxpayer’s declaration and separate declarations for an authorized representative. A separate appeal letter also needs the required information and statement. Retain the rejection letter and identify the tax forms and periods involved.
If someone signs for you, establish that person’s authority for the taxpayer and matters involved. The form calls for a completed Form 2848 when an authorized representative signs. Form 8821 permits specified information access; it does not authorize advocacy in an OIC collection matter.
For a rejected joint offer, both taxpayers’ participation and signatures need attention. The manual describes seeking the other spouse’s signature when only one signs; if the request is not perfected, the appeal can be considered only for the spouse who signed. Do not assume one signature preserves identical treatment for both people.
The IRS describes a practice of attempting to correct a timely request missing required signatures or declarations, generally allowing a reasonable period of no more than 15 calendar days. This is not a statutory extension for every incomplete request. Respond promptly to the actual correction request and retain what you supplied.
If the offer was returned, examine the reconsideration route
A returned offer does not have the ordinary rejection-appeal right. Read the return reason before sending Form 13711 or simply resubmitting the same package.
The FAQs describe requesting reconsideration of an erroneous return by calling the number on the return letter and providing objections within 30 days from that letter’s date. IRM 5.8.7.3.1 gives a general 30-calendar-day rule and retains a qualification where the condition preventing the requested substantiation continued for a prolonged period. Preserve the actual cause, dates and proof; that qualification does not establish unlimited extra time.
The reason and the claimed error matter
The IRS lists ordinary exclusions involving bankruptcy, noncompliance after submission, offers submitted solely to delay collection, jeopardy, other pending investigations and an abated original assessment. The manual preserves reconsideration where such a return was determined to be erroneous. An objection still needs evidence of that error.
Other potentially relevant circumstances include information sent on time but not associated with the case, particular disaster or combat-zone circumstances, or qualifying illness or family death that prevented a timely response. These are conditional examples, not automatic eligibility categories.
Distinguish proof you were compliant when the offer was returned from becoming compliant afterward. The manual says an actually noncompliant taxpayer whose offer was validly returned must submit a new offer. A later payment alone does not prove the earlier return was wrong.
Track approval and any further information request
Return reconsideration requires the appropriate manager’s approval. A request, a discussion of possible merit and an approved reconsideration are separate events. Where the employee finds merit and the manager concurs, the manual describes obtaining missing substantiation, forms or applicable fees within 10 calendar days of the contact. Follow and record the actual request; do not treat that as a general extension of the original objection period.
If reconsideration is approved, the IRS may request the original Form 656 and Form 433-A/B (OIC). Its FAQs describe a replacement Form 656 with the same amount and terms if the original is unavailable, returning an application fee that was refunded, and applying original offer payments to the new offer record. The manual generally does not require an additional application fee and initial payment for qualifying reconsideration.
Confirm the instructions for your actual case. Reconsideration does not mean the original offer was accepted or that you can keep a returned fee the IRS asks you to resend. A separate new application must meet its own requirements.
Separate offer payments, current taxes and collection status
While an offer remains under consideration, required periodic offer payments generally continue unless the qualifying individual low-income exception applies. For a missed periodic payment in the FAQ’s described process, the IRS says it will attempt contact and provide one opportunity to pay the missing amount. Failure to do so can result in withdrawal and return without appeal rights. It is inaccurate to describe every missed payment as an automatic formal rejection.
After an offer is rejected, IRM 5.8.7.7 says there is no obligation to continue the periodic payments under that offer schedule, even during an appeal. Confirm the actual decision before applying that rule. Required returns, current taxes, remaining debt and any separate arrangement still need attention.
Offer payments already sent generally remain applied to tax. The application fee has different treatment, including where an offer was not accepted for processing. The current form describes payments, not a universally refundable 20% deposit. Retain the posting record and any specific reconsideration instructions about earlier payments.
A qualifying appeal has levy protections with limits
Section 6331(k) generally prohibits a new levy for the covered unpaid tax while an offer accepted for processing is pending, for 30 days following rejection, and while a rejection appeal filed within that period is pending. The applicable rules include exceptions involving waiver, jeopardy, offsets and earlier levies.
That protection is not proof that an existing wage levy was released or that funds already levied will be returned. Establish the actual release and transmission records for that action. A Notice of Federal Tax Lien may still be filed, and interest and penalties can continue.
Qualifying offer consideration, the rejection interval and a timely appeal can also suspend the collection limitation period. Record the actual person, tax and start and end events in the assessment and collection-period record. Do not automatically add another 30 days after an Appeals decision, assign a rejection interval to every returned offer or infer one expiration date for the whole account.
Follow the review through to a written result
Collection may first review new information included in your appeal. If that reconsideration does not change the rejection, the requested appeal must still be forwarded. Sending an updated worksheet or receiving another examiner call is not itself evidence that Appeals has decided the case.
Keep updated financial tables, information requests, your replies and any transfer communication. The manual also provides for sharing significant new information with the taxpayer when it is supplied to Appeals and allowing a response. Record the actual requests and outcomes rather than assuming a fixed appeal-completion time.
Manager discussions and qualifying Fast Track Mediation can concern a disagreement before rejection. The IRS says Fast Track Mediation does not apply once the rejection letter has been issued. Neither a manager call nor a mediation inquiry replaces the formal appeal request.
If rejection is sustained
Retain the dated Appeals letter and check what remains unresolved. For a non-CDP offer, the manual says Appeals no longer retains jurisdiction after sustaining rejection. It describes limited reopening circumstances, including requested information provided on time but misrouted, or an emergency that prevented a response. The ordinary request in that process must be postmarked no more than 30 days after the Appeals determination letter; later reopening requires the specified higher-level agreement.
Those provisions do not create an automatic second appeal. Preserve the relevant decision and evidence for the handling office to review. An OIC rejection or sustained appeal does not itself create a CDP notice or an unrestricted Tax Court path.
Another resolution also requires its own decision. The IRS describes reinstating a prior installment agreement after an unsuccessful offer where no additional tax debt was incurred. Verify the confirmation and terms; reinstating a direct-debit agreement can require a newly signed Form 433-D. Do not assume an old debit has restarted or that every new agreement is exempt from fees.
Use the existing installment-agreement routes or temporary hardship collection status for their requirements. A failed offer does not establish approval of either. Keep a proposed arrangement, an accepted arrangement and its actual implementation as separate records.
Sources and scope
- IRS appeal instructions and Form 13711: ordinary rejection appeals, disagreement records and signatures.
- IRS offer FAQs and Form 656-B, April 2026: returns, payments, application stages and offer terms.
- IRM 5.8.7: selected return-reconsideration, rejection, appeal, payment and alternative-resolution provisions. The hosted manual’s transmittal is dated April 24, 2025; sections retain their own dates.
- 26 USC 6331 and IRM 5.1.19.3.4: qualified levy and collection-period effects.
Checked November 13, 2026. The current-hosted Form 13711 is revised December 2017. This guide organizes a response and evidence; it does not determine a person’s filing deadline, acceptable offer, reconsideration eligibility or legal outcome.