The Nevada Offer in Compromise (OIC) program allows qualifying taxpayers to resolve their outstanding state tax liabilities for less than the full amount owed. The Nevada Department of Taxation administers this program, which evaluates the taxpayer’s income, essential living expenses, and available assets to determine whether a reduced settlement amount is appropriate. Rather than facing ongoing collection actions or accruing penalties, eligible individuals and businesses may request a compromise that reflects their financial capacity to pay.
Nevada’s OIC process differs from the federal IRS Offer in Compromise in several respects. Unlike the IRS program, Nevada does not charge an application fee, and its review process incorporates local cost-of-living standards rather than national benchmarks. To be considered, applicants must be current on all tax return filings. They may request relief under three specific categories: doubt as to collectability, doubt as to liability, or considerations of equity and fairness—such as serious illness, financial hardship, or losses due to natural disasters.
This guide gives an in-depth look at Nevada’s Offer in Compromise procedures. It outlines eligibility criteria, required documentation, and the steps for completing Form REV-F021. It also includes guidance on preparing a financial disclosure, presenting a clear statement of facts, and avoiding common application errors. This resource is meant to help individuals, sole proprietors, and small businesses deal with their Nevada tax debt, whether it comes from personal income taxes, business taxes, or other state obligations, in a legal and organized way.
Before you dive into the application steps, it helps to grasp exactly what the Nevada OIC program is and why it exists. When faced with overwhelming tax debt—whether from income tax, property taxes, or penalties assessed by the Nevada Department of Taxation—the standard paths (installment agreements or levy actions) may still leave you struggling to pay your full liability. The OIC offers an alternative: negotiate to pay less than what you owe, based on your current income, allowable living expenses, and total assets. In this section, we’ll define the program under NRS 360.263, explain the Tax Commission’s role, and compare it to the federal IRS Offer in Compromise so you can decide which option best fits your circumstances.
Under Nevada Revised Statutes 360.263, the Tax Commission can accept less than the full payment of any tax liability, including penalties and interest. This program aims to provide relief when a complete collection is unlikely or inequitable.
The Commission reviews departmental recommendations and votes on each offer. Their decision considers financial analyses provided by the Department of Taxation and any exceptional circumstances the taxpayer presents.
Unlike the IRS OIC, which charges a $205 application fee (waived for low-income filers), Nevada’s program has no statutory fee but requires all filings to be current. Both programs require proof of inability to pay full liability.
The IRS follows federal living-expense standards; Nevada references IRS guidelines but may adjust for local cost of living. Nevada explicitly includes equity and fairness grounds—such as medical hardship or crime victim status—while the IRS allows only “exceptional circumstances.”
Not every taxpayer automatically qualifies, so you must understand the three legal grounds for an OIC in Nevada. First, “doubt as to collectability” requires proving your income and assets—after deducting allowable expenses—cannot cover your total tax debt in the foreseeable future. The second is "doubt as to liability," which occurs when there is a fundamental disagreement about whether or not you owe taxes. Third, “equity and fairness” considers exceptional circumstances like medical hardships or natural disasters that justify reducing your debt even if collectability and liability tests aren’t met. We’ll break down each criterion—showing you how to demonstrate low income, disputed tax bills, or extreme hardships—to help you qualify and craft a compelling offer.
After covering basic living expenses, you must show that your income and assets are insufficient to pay the full tax debt now or in the foreseeable future.
Nevada uses IRS national and local standards to calculate allowable living expenses, ensuring you keep only what is necessary for basic needs.
You can dispute liability if you believe in good faith that the assessed tax amount is incorrect due to factual errors or misapplied law.
The Tax Commission will evaluate whether your dispute is sincere and supported by documentation, such as audit reports or legal opinions.
Situations beyond your control—serious illness, natural disaster, or victimization—can justify an offer even if collectability or liability grounds aren’t met.
This category prevents undue hardship when strict enforcement violates principles of equity, ensuring the system remains just.
Filing a successful OIC is all about preparation and precision. You must first file all required returns and be current on back taxes before submitting an offer. Next, you’ll download and complete Form REV-F021, listing the exact tax periods and types of taxes (e.g., sales tax, income tax, property) you wish to compromise. Gathering documentation—bank statements, proof of assets, expense worksheets, and hardship records—is critical to show the Nevada Department that your proposed payment is reasonable. In this section, we’ll walk through each application step, from structuring your narrative to signing the waiver of limitations, so you can submit a complete package the first time and avoid delays.
Applications missing any required returns will be returned without consideration. Filing compliance shows willingness to cooperate.
Visit the Nevada Department of Taxation website’s “Offer in Compromise (OIC) Forms” section to download REV-F021.
Provide accurate contact details, tax types and periods, an offer amount, and funding sources.
Include pay stubs, bank statements, vehicle/appraisal records, mortgage statements, and outstanding loans.
If you are applying under equity and fairness, please submit medical bills, insurance claims, or disaster reports.
Outline your financial situation, reasons for the offer, and any special circumstances in a concise narrative.
To facilitate evaluation, use headings for “Background,” “Financial Snapshot,” and “Reason for Offer.”
Under penalty of perjury, affirm that all information and documents are accurate.
Agree to suspend statutory periods of limitation so the Department can consider your offer without time constraints.
Completed packages can be emailed to nevadaolt@tax.state.nv.us with the subject "Offer in Compromise" or mailed to the department's physical address.
The Department acknowledges receipt, reviews documentation, and may request additional information before recommending.
Once you hit “submit,” the Nevada Department of Taxation reviews your OIC package in detail. The Nevada Department of Taxation compares your income, expense, and asset figures to IRS living-expense standards, making local adjustments for Nevada's cost of living. Should your documentation be incomplete or prompt any questions, you will receive a request for additional information—please ensure you regularly check your email and mailbox. After analysis, the Department issues a recommendation to the Nevada Tax Commission, which formally votes on accepting or rejecting your offer. We’ll outline each post-submission step, explain how and when levies pause, and describe the payment terms you’ll receive if your offer is accepted.
Analysts verify your figures against IRS standards and check for completeness.
If the Department plans to reject, you’ll get notice to withdraw; otherwise, the Commission votes at its next meeting.
The taxpayer may accept, reject, or withdraw offers before a formal decision.
You’ll receive a written agreement outlining the payment schedule and ongoing filing requirements.
Failure to meet terms reinstates original liability minus payments made.
Abstract rules can feel daunting until you see them in action. In this section, we present real-world examples to illustrate how different taxpayers—such as someone with minimal income, old tax bills, or a homeowner devastated by wildfire—qualify under “doubt as to collectability” or “equity and fairness.” By walking through these scenarios, you’ll better understand how to frame your circumstances, choose the right eligibility category, and estimate a reasonable offer based on your finances.
A single parent earning minimum wage with minimal savings and an aged tax liability may qualify under collectability grounds.
A homeowner displaced by a wildfire with documented losses could invoke fairness considerations.
Even well-intentioned offers can be rejected for avoidable errors. Failing to include complete asset schedules or leaving blank fields on Form REV-F021 automatically triggers delays. Offering an unreasonably low payment or withholding information about vehicles, retirement accounts, or other types of assets undermines your credibility. Skipping the required waiver of limitations means your request will be returned unread. We’ll highlight the most frequent mistakes. This guide will highlight common mistakes and demonstrate how to double-check your application to ensure you can submit a dossier that meets all Nevada Department requirements.
Missing bank statements or unsigned forms lead to automatic returns or rejections.
Unrealistically low offers or undisclosed assets undermine credibility.
A well-written statement guides reviewers; ambiguity raises doubt.
Without the waiver, your application cannot be processed.
Complex business structures or high liabilities often benefit from expert assistance.
Ensure that all required tax returns for each period included in your offer have been filed. Being current with your filings shows the Nevada Department of Taxation that you’re compliant with state requirements and prevents automatic return of your application.
Double-check that every section of Form REV-F021 is filled out accurately, including your contact information, tax types, periods, proposed payment amount, and funding source. Incomplete or inconsistent entries can delay processing or cause your entire package to be rejected.
Gather and attach pay stubs, bank statements, asset valuations, expense worksheets, and any records supporting equity and fairness claims. Providing a complete financial picture helps the Department verify your income, expenses, and assets when assessing your tax liability and ability to pay.
Write a straightforward narrative explaining your circumstances—such as medical hardship, job loss, or disaster impact—and why you cannot pay the full tax debt. A well-structured statement helps reviewers understand your situation and strengthens your request for a reasonable compromise.
Sign under penalty of perjury to affirm that all information and attachments are truthful and accurate. Also, sign the waiver of limitations to suspend the statute of limitations while your offer is under review, ensuring your application isn’t returned unprocessed.
Keep all submitted materials, including a signed Form REV-F021, financial attachments, and your narrative statement. Having your copy makes it easier to respond to follow-up questions and defend against any discrepancies the Department may find.
Submit your complete package via the correct channel—email nevadaolt@tax.state.nv.us with “Offer In Compromise” in the subject line or mail it to the Department’s official address. Proper submission ensures your request lands with the right team and avoids routing errors.
Monitor your email and mailbox regularly after submission if the Department requests additional documentation or clarification. Prompt responses help maintain momentum in the review process and reduce the time it takes to reach a final decision.
Processing times at the Nevada Department of Taxation typically span three to six months from the date you submit a complete application. Your OIC can be delayed if required income tax returns, documentation of assets or expenses, or proof of hardship is missing. Timely responses to department requests help prevent additional backlogs and move your request toward a final decision faster.
Yes, under NAC 360.438(5), the Nevada Department will generally cease all levy and garnishment actions on your tax debt, including income tax, property taxes, and penalties, while your OIC is under review. This pause applies unless the Department determines your offer was submitted primarily to delay payments. Pausing collections gives you breathing room to organize finances and support your request.
If the Commission rejects your OIC, the Nevada Department’s notice will explain why your proposed payment or documentation was insufficient. You can submit a new offer with revised terms, file for an installment agreement, or explore alternative relief for back taxes and tax liability. Review asset disclosures, living expense calculations, and narrative circumstances before resubmitting to strengthen your next application.
Yes, the state and IRS Offer in Compromise programs are separate. You may simultaneously pursue a Nevada Offer in Compromise (OIC) with the Nevada Department of Taxation and an Offer in Compromise through the federal IRS process. Each program has its own eligibility standards, forms, and timelines. Applying for both may maximize your chances of settling tax debt in multiple jurisdictions and reduce overall liability.
If you miss a scheduled payment or fail to pay the agreed amount under your accepted compromise, the Commission may declare your OIC in default. Your original tax liability—plus any unpaid penalties, interest, and levy fees—will be reinstated. To prevent reinstatement, please ensure you can promptly accommodate the negotiated payments within your budget and submit all future returns.
Corporations, partnerships, LLCs, and sole proprietorships can qualify for Nevada’s OIC program. The Nevada Department evaluates business income, expenses, assets, and tax liability—such as sales tax, property tax, or other types of state taxes—similar to individual applications. Providing complete financial statements and clear narratives of your business circumstances will help demonstrate collectability or fairness grounds.
Nevada law does not explicitly list accepted OIC agreements as public record, so your settlement details generally remain confidential with the Nevada Department of Taxation. Unlike federal OICs—which become part of the IRS’s public record—state compromises are subject only to routine transparency statutes. Typically, public disclosure protects your finances, assets, and negotiated payments.
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