Delay in refund after offer in comprise acceptance?

Question

I just recieved a notice from "Chief, Service Center Collection Branch" that my $30.00 refund has been delayed. they want to see if I owe any other taxes. I just successfully completed an "Offer in Comprise" with the IRS. Is this the possible reason for the delay? I am a bit nervous!

I owed $51,000 in taxes and the government accepted $11,100. which I paid in full 6 months ago.

I will also add that I am extremely grateful for the O in C I was able to negociate and have no problem with them keeping my $30.00!

Answer 1

Per the Terms of the OIC that state the following
Effect of the Offer on the Taxpayer’s
Refund — The IRS will keep any refund,
including interest due to the taxpayer because
of overpayment of any tax or other
liability, for tax periods extending through
the calendar year that the IRS accepts
the offer. The taxpayer may not designate
an overpayment ordinarily subject to
refund, to which the IRS is entitled, to be
applied to estimated tax payments for the
following year.
page 20 of 44
http://www.irs.gov/pub/irs-pdf/f656.pdf

Answer 2

Unless the debt is paid in full under the OIC, any refunds coming will automatically be captured to offset the debt. And any refund for the year of acceptance will be taken as well.

Answer 3

Yes, that's the reason. Relax, you're not in trouble. :-) However, you still won't see the refund. An offer in compromise still isn't a full payment of your taxes, so the refund is still going to be taken and applied against your outstanding balance (usually goes towards your oldest delinquent year) every year until your taxes are completely caught up.

Hope this helps!