I have found over the past year that the IRS will do just about anything to deny an OIC based on doubt as to collectability, including cheating and lying. Such as: creating an asset by imputing equity into a real estate transaction two years before the OIC-despite having copies of the settlement statement showing only a few hundred dollars netted from the transaction. Or, refusing to acknowledge a child support order despite having copies of it. Or, imputing income from a job that the taxpayer never had. And the list goes on and on.
Most times this nonsense is stopped at appeals, but even there I have on occasion run into this dishonest mind set. OICs raising liability issues are still being process professionally. Anybody have a clue how long this attitude will continue? I have been told off the record by IRS employees that this approach is a top-down directed mandate-deny OICs through any means. It appears that OIC appeals is starting to revolt on account of the increase in their workload. Appeals are getting REAL slow.