What is really crazy, is that in looking at the OIC pre-qualifying tool at https://irs.treasury.gov/oic_pre_qualifier/, it says you have to have made all estimated tax payments prior to applying for OIC. But that is a paradoxical situation - my estimated tax on the quarter I made the IRA withdrawal was about $10K. But I don't have $10K on hand at moment. So seems I would have to pay about 25% of total taxes for 2021, before I could submit an OIC for 2021!
Here is what it says on the OIC booklet:
Before your offer can be considered, you must (1) file all tax returns you are legally required to file, (2) have received a bill for at least one tax debt included on your offer, (3) make all required estimated tax payments for the current year, and (4) make all required federal tax deposits for the current quarter if you are a business owner with employees. The IRS will immediately return your offer without further consideration if you have not filed all legally required tax returns.
Or maybe I am interpreting "current year" wrong. I thought it meant to have submitted estimated payments for the current tax return you are working on. I am working on 2021 return, don't expect any estimated payments in 2022 (unless I have to withdraw from IRA again to pay down this balance!). Or they mean 2022 as the "current year".
