Application requirements
You may be eligible for a settlement offer with the Oregon Department of Revenue (DOR) if you owe more tax than you can pay.
- Not everyone qualifies for a settlement offer. You may want to apply if:
- You are exclusively on a fixed income or receive public assistance.
- Your total assets are worth less than what you owe.
- You have had a significant reduction in income.
- Your rights to appeal your tax debt must have expired.
- You must have filed all required Oregon tax returns for all tax years and all tax types.
- You must show that you cannot sell assets or borrow against them to pay your tax debt.
- You must show that you do not have enough monthly income or assets to pay your debt in full.
- You are not in active bankruptcy or in litigation.
Submitting a settlement offer application
- Review the settlement offer application instructions. Printing these to refer to while completing the application form is helpful.
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Complete the settlement offer application online or complete the paper version which is available to print online.
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Gather supporting documents listed in the form and include them with your application.
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Include a payment equal to 5 percent of the offer (line 87, page 7 of the application form). The payment will be applied to your tax balance.
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Mail your settlement offer materials to:
- Oregon Department of Revenue, PO Box 14725, Salem OR 97309-5018
Note: DOR will not consider an offer of $0.00 (zero). Your settlement offer must be an amount that is larger than $0.00.
DOR may need additional information
If DOR sends you a letter asking for missing or additional information, you must respond in a timely manner. The deadline will be stated in this letter. We will deny your application if we do not receive the requested information by this date.
Your settlement offer is accepted
You will receive a letter if your offer is accepted. It will specify the terms of the offer, including:
- Voluntary payment of the settlement offer amount in full within 30 days or you may ask for a monthly payment plan.
- All payments, refunds, or credits received by DOR prior to the approval of your settlement offer will be applied to your debt and not to your settlement offer amount.
- Your forfeiture of your right to appeal [ORS 305.280 (3)].
- Completing the compliance period by filing and paying all taxes due for three years from the date you pay your settlement offer amount in full, you will have 90 days, from the day you receive the notice from DOR, to pay a new tax debt in full.
- Authorization for DOR to contact third parties (IRS, Oregon Employment Department, credit reporting firms, etc.) to verify the information you provided in your settlement offer application.
- The release of any tax lien on your property after full payment of the settlement offer amount and completion of the compliance period.
Failure to comply with the terms of the settlement offer agreement will be considered to be default of the agreement, and DOR can continue collection of the full amount you owe.
Your settlement offer is denied
You will receive a letter stating that your offer was denied and explaining the reasons. This decision cannot be appealed.
The required 5 percent payment will be applied to your current debt.
You may submit a new settlement offer application, with a new 5 percent payment, at any time.
Frequently asked questions
This payment is calculated based on the assets and expenses you report on your application. The 5 percent payment amount will be on page 7, section 6, line 88 of the settlement offer application.
It is applied to your balance owing.
It is applied to the balance you owe.
It is still applied to the balance you owe.
The amount that is appropriate for each customer is determined by your financial situation and the resulting calculation. The amount is located on page 7, section 6, line 87 of the settlement offer application.
We will not accept less than the amount shown on line 87 of the settlement offer application. If the amount on line 87 is greater than the amount that you owe this indicates that, based on the calculation, you can pay your debt in full.
Liens are released after completion of the three-year settlement offer compliance period. This period begins after you have paid your settlement offer amount in full.
Liens are released after completion of the three-year compliance period. This compliance period begins after you have paid your settlement offer amount in full.
Settlement offer applications are processed in the order they are received. We usually make a decision within 30 days if your application is complete and we have received all required documents.
Settlement offer applications are processed in the order they are received.
We usually make a decision within 30 days if your application is complete and
we have received all required documents.
A settlement offer denial cannot be appealed. However, you may resubmit an application with additional information such as changes to your income, expenses, or financial situation that you would like DOR to consider. You will have to include a 5 percent nonrefundable payment with each new application.
In general, all debts owed by an individual to DOR may be included in a settlement offer. Exceptions include debt owed by an individual for an open business, and debts owed to another state agency for which the DOR Other Agency Accounts (OAA) program is collecting.
Note: Business entities are not eligible for the settlement offer process.