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Official form guide
Form 656: Offer in Compromise
IRS Form 656 is used to submit an Offer in Compromise for tax debt and is intended for tax professional use only. Individuals must use Form 656-B; if qualifying for Low-Income Certification, payments are not required.
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IRS Form 656 - Offer in Compromise
IRS Form 656 is used to submit an Offer in Compromise for tax debt and is intended for tax professional use only. Individuals must use Form 656-B; if qualifying for Low-Income Certification, payments are not required.
Risk Radar
Scan points- 1Individuals MUST use Form 656-B, as Form 656 alone is intended for tax professional use only.
- 2Filing Form 656 instead of Form 656-B (required for individuals)
- 3Failing to include completed financial statements with the offer
- 4Not including the required application fee and initial payment at submission
- 5Submitting an offer without certifying Low-Income Certification if applicable
Plain English
This form allows a taxpayer to propose a settlement with the IRS regarding outstanding tax debts. By submitting this Offer in Compromise (OIC), the filer seeks to resolve the debt for less than the full amount owed. The offer must include financial statements and an initial payment when submitted.
Submission Date
- Filing date: 2026-04-18 16:10:36
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when submitting an Offer in Compromise for tax debt and you are a tax professional (individuals should use Form 656-B).
- Do not use it when the individual filer qualifies for Low-Income Certification, as payments may be waived.
- Check Form 656-B instead when you are an individual requesting consideration of an offer.
Form selector
Use this form or another form?
Business Entity
Must complete this section if the entity is a Corporation, Partnership, LLC, or LLP to compromise tax debts.
✓ Check that all required documentation, including Form 433-B (OIC), is included.
Lump Sum Offer
Use this option if paying the offer in 5 or fewer payments within 5 or fewer months from acceptance.
✓ Ensure you fill in the specific amount(s) for future payments alongside the initial payment.
Attachment Needed
If more space is required, use an attachment and ensure it is signed and dated.
✓ Verify that the date on the attachment matches the submission date of your main Form 656.
Attachment to Form 656 dated [Date]
Deadline or filing window
The official source does not state a specific deadline date for submission. However, if the taxpayer certifies they have filed all required returns, those must be included within 10 weeks of the offer's submission.
Checklist
What you need before filling it out
Form 656 (Overall)
Form 656 · Intended for tax professional use only.
Application Fee/Initial Payment
$205 application fee and initial payment · Form 656 Section 3 & 4
Business Entity Status
Complete Section 2 of Form 656 · Form 656 Section 3
Payment Designation (Section 5)
Specific tax year/quarter · Form 656 Section 5
Filing Requirement Check
Complete copy of return filed within 10 weeks · Form 656 Section 5 (Filing Requirements)
Payment Separation
Initial Offer Payment and Application Fee · Form 656 Section 5
Before you submit
- 1Include a complete copy of any tax return filed within 10 weeks of this offer submission.
- 2Ensure the required $205 application fee and initial payment are included with your Form 656.
- 3If filing for a business, confirm Section 3 includes all necessary details (EIN, addresses, contact info).
- 4Check only one option in Section 4 to indicate how long it will take you to pay the offer in full.
- 5Confirm that if paying electronically, the application fee/initial payment was made on the same date as mailing/filing via IOLA.
- 6Verify that payments are separate for the initial offer payment and the application fee (do not combine them).
- 7If using EFTPS/IOLA, ensure the EFT number is correctly listed for each payment type.
How to file this form
- 1Complete Form 656 by filling in all required sections, paying attention to whether you are an individual or a business entity.
- 2Gather and include all supporting documents, such as financial statements, the Form 433-B (OIC), and any necessary attachments.
- 3Submit payment of $205 for the application fee and initial offer payment, ensuring these payments are separate from other tax amounts.
- 4Designate your offer payments in Section 5 by specifying the tax period/quarter if you want the IRS to apply them to a specific debt.
- 5Sign and date Form 656 (and any attachments) before sending it to the IRS.
- 6Mail or file Form 656, along with all required payments and documents, to the appropriate IRS service center.
Known limitations
- 1Form 656 is intended for tax professional use only; individuals requesting consideration must use Form 656-B.
- 2Individuals who are not sole proprietors or whose offer pertains to a deceased individual do not qualify for Low-Income Certification (unless the business is otherwise listed).
- 3If an offeror qualifies for Low-Income Certification, they are not required to submit any payments or the application fee upon submission or during consideration of the offer.
- 4The IRS will verify whether an individual qualifies for Low-Income Certification; checking a box certifies qualification but does not guarantee it.
- 5When designating payment on Form 656, if no specific tax period/quarter is provided, the IRS applies the money to the government's best interest.
Field map
Compact field-by-field guide
General Info
2 items
Full legal name and taxpayer identification number (SSN or EIN).
Current mailing address.
Details
2 items
Complete all applicable sections of this form according to the official IRS instructions.
Enter the relevant dollar amount if this form involves tax calculation.
Certification
1 items
Read and acknowledge any certifications required by this form.
Signatures
1 items
Sign and date. Unsigned forms cannot be processed.
Almost done reviewing the fields?
Fillable formOpen in Editor->The current edition is Form 656 (Rev. 4-2026). The source does not point to a specific 'latest information' page, but it notes that individuals must use Form 656-B.
What changed or needs a fresh check
- Edition date — confirm the revision reads 4-2026.
- Application Fee — confirm the required payment is $205 (unless Low-Income Certification applies).
- Mailing address — the source does not provide a specific mailing address, but it requires you to include one on Form 656 Section 3.
- Signature — ensure the form is signed and dated before sending.
- Payment Method — confirm that payments must be in U.S. dollars and cash should not be sent.
Quick Facts
Downloads
After you file
- 1Keep a copy of the completed Form 656 for personal records.
- 2Include all required financial statements and the application fee when submitting Form 656.
- 3If filing an offer, ensure that a complete copy of any tax return filed within 10 weeks of submission is included (or state if no return was required).
- 4Do not include original tax returns; if sending copies, clearly mark them as such.
- 5The IRS will process the offer and may return it if the application fee or required payment is missing or returned for insufficient funds.
Sources
- SRCInstructions p.1 — Form 656 is intended for tax professional use only; individuals must use Form 656-B.
- SRCInstructions p.1 — Completed financial statements and the required application fee and initial payment must be included with your Form 656.
- SRCInstructions p.2 — The form's catalog number is 16728N, and the revision date is April 2026 (Rev. 4-2026).
- SRCInstructions p.3 — Low-Income Certification applies to Individuals and Sole Proprietors only.
- SRCInstructions p.3 — If you qualify for Low-Income Certification, you are not required to submit any payments or the application fee upon submission or during consideration of your offer.
- SRCInstructions p.4 — You must select one reason from Section 3: Doubt as to Collectibility, Effective Tax Administration - Economic Hardship, or another option (implied).
- SRCInstructions p.5 — If you want a specific payment designated, tell the tax period/quarter in Section 5.
- SRCInstructions p.5 — Payments must be made payable to the “United States Treasury” and attached to the front of Form 656.
Common confusion points
Which form should I use?
Form 656 is for tax professionals, but individuals must use Form 656-B.
→ Check the top of Form 656 to confirm if you need to submit this document or Form 656-B.
Do I have to pay anything if I qualify for Low-Income Certification?
If qualified, no payments or application fee are required upon submission or during consideration.
→ Ensure you check the appropriate box on Page 2 and that your income meets the chart requirements.
How do I designate my payment?
Specify a tax period/quarter if you want the IRS to apply the money to a specific debt; otherwise, it goes to the government's best interest.
→ Check Section 5 to see how detailed your designation needs to be.
What should I send with my offer besides the form itself?
You must include completed financial statements and the required application fee/initial payment.
→ Failure to include these items will delay consideration of the offer.
Can I combine my payments?
No, pay a separate application fee with each offer; do not combine it with any other tax payments.
→ This separation prevents delays in processing your offer.
What if I don't have an original return to send?
You must either electronically file or mail the tax return before sending in Form 656, or note that you were not required to file for certain years.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- If you cannot pay via EFTPS or IOLA, you may use a personal check, cashier's check, or money order.
Questions about IRS Form 656
What is IRS Form 656 used for?
This form allows a taxpayer to propose a settlement with the IRS regarding outstanding tax debts. By submitting this Offer in Compromise (OIC), the filer seeks to resolve the debt for less than the full amount owed. The offer must include financial statements and an initial payment when submitted.
Who must file IRS Form 656?
The primary filers are taxpayers who wish to request consideration of an offer, though Form 656 is intended for tax professional use only.
What information does IRS Form 656 require?
The form collects details such as the business name and address (physical and mailing), Employer Identification Number (EIN), payment schedule information (e.g., first monthly payment amount), and certification regarding income qualification.
Where do I file IRS Form 656?
Payments must be attached to the front of Form 656; if paying electronically via EFTPS or IOLA, this is the method. The form itself does not list a specific processing office address for mailing.
How do I complete IRS Form 656?
The filer must complete all necessary sections (like Section 2 for businesses). The taxpayer or corporate officer must sign and date Section 8 under penalty of perjury. If a paid preparer is used, they must also complete and sign Section 9.
What happens if IRS Form 656 is filed incorrectly?
Failure to include required information will delay consideration of the offer; specifically, failure to pay the application fee and initial payment may cause the offer to be returned.
Which form should I use?
Form 656 is for tax professionals, but individuals must use Form 656-B. Check the top of Form 656 to confirm if you need to submit this document or Form 656-B.
Do I have to pay anything if I qualify for Low-Income Certification?
If qualified, no payments or application fee are required upon submission or during consideration. Ensure you check the appropriate box on Page 2 and that your income meets the chart requirements.
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