Form 656-B: Your OIC Instruction Manual
Form 656-B isn't filed — it's read. The official IRS Offer in Compromise Booklet contains every instruction, definition, form, and worksheet you need to understand before attempting an OIC. Skipping this booklet is the #1 reason OICs get returned or rejected. Here's what's inside and what matters most.
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What Form 656-B Covers
Collection Information Statement (Form 433-A OIC)
The booklet includes the full Form 433-A (OIC version) with instructions for every line. This is the most detailed financial disclosure the IRS requires — missing or incorrect entries are the #1 reason for OIC return/rejection.
Reasonable Collection Potential (RCP) Worksheet
The booklet teaches you how the IRS calculates what you can afford to pay — your equity in assets plus your future disposable income. Understanding RCP before you submit an offer amount is essential to setting a number the IRS will accept.
Payment Terms and Methods
Lump Sum Cash (paid within 5 months, 20% down) vs. Periodic Payment (paid over 6-24 months, first payment with application). The booklet explains the payment rules, when payments are applied, and what happens if you miss one.
Low-Income Certification Guidelines
If your income is at or below 250% of the HHS poverty guidelines, you qualify for a waiver of the $205 application fee and the initial payment. The booklet includes the current poverty guideline tables.
Offer Processing Timeline
What happens after you file — the 30-day initial review, the investigation phase, the OIC specialist's evaluation, and the acceptance or rejection timeline. Knowing the process prevents panic when the IRS goes quiet for months.
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We handle every form, calculation, and disclosure — so you don't have to navigate the 656-B booklet alone. Free OIC evaluation.