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OFFER IN COMPROMISE APPLICATION

For Department Use Only
NAME:
DOING BUSINESS AS:
o CC
ADDRESS:
o M/O

Effective Date: _____________________________

Last 4 Digits of Social Security EDD Employer Payroll Tax Account Amount Paid: Log Number:
Number: Number:
$

1. The undersigned submits this Offer in Compromise for payment of California state payroll tax liability, which includes
Unemployment Insurance, State Disability Insurance, Employment Training Tax, Personal Income Tax, penalty, and
accrued interest described as follows:

2. The total amount of the offer: $ See specifc instructions.

3. A full fnancial disclosure, including community property, is contained in the fnancial statement, submitted as part of
this application.

4. Explain the facts and reasons why this offer should be accepted:

5. All payments made with this offer are submitted voluntarily. In the event an offer is not accepted, the amount will either
be applied to the liability or refunded, at the discretion of the individual submitting the offer. Check the appropriate box
below:

Retain the amount offered/apply to account.

Refund the amount paid.
Monies paid to the Employment Development Department (EDD) with an offer will not be applied against the liability until
the offer has been accepted.

DE 999A Rev. 6 (3-20) (INTERNET) Page 1 of 4

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ELIGIBILITY REQUIREMENTS

• Any person assessed under section 1735 of the California Unemployment Insurance Code (CUIC) (leginfo.legislature.
ca.gov/faces/codes.xhtml), a partner or an individual owner with inactive, out-of-business accounts.

• Any person assessed under section 1735 of the CUIC, a partner or an individual of an active business, only if you no
longer have a controlling interest or association with the business.

• Any person assessed under section 1735 of the CUIC, a partner or an individual owner who does not have access to
current income suffcient to pay more than the accumulating interest and 6.7 percent of the liability on an annual basis.

• Any person assessed under section 1735 of the CUIC, a partner or an individual owner who does not have assets,
whether or not subjected to lien by the EDD, that if sold, would satisfy the liability.

• The amount offered by the individual must be more than the EDD could expect to collect through involuntary means
within four years of the time the offer is made.

• Only non-disputed, fnal tax liabilities will be considered for compromise. Liabilities under petition or bankruptcy will
not be considered.

• Liabilities, as a result of fraud (section 1128 of the CUIC) or actions resulting in a conviction for a violation of the CUIC,
will not be compromised.

Acknowledgment of Facts

A determination by the Director that it would not be in the best interest of the state to accept partial payment in satisfaction of
a tax liability will not be subject to administrative appeal or judicial review.

When in the Director’s judgment it serves the best interest of the state, the Director may permit the agreed upon amount to be
paid in installments under a payment agreement not to exceed fve years in length.

It is understood that this offer will be considered and acted upon in due course and that it does not relieve the individual
from the liability sought to be compromised unless and until the offer is accepted in writing by the Director or a delegated
representative and there has been a full compliance with the terms of the offer.

All liens will remain in effect until the terms of the compromise agreement are fulflled, including payment of the amount
offered.

Under penalty of perjury, I declare I have examined this offer, including accompanying documents, and to the best of my
knowledge and belief, it is true, correct, and complete.

Signature of Applicant: Date:

Signature of Applicant’s Authorized Representative: Title: Date

Part 1 (EDD Copy)

DE 999A Rev. 6 (3-20) (INTERNET) Page 2 of 4

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Background 3. A statement will be placed on fle with the EDD
containing the following information:
The Offers in Compromise program is governed by
article 8, sections 1870-1875 of the CUIC. This program a. The individual’s name and Offer in Compromise
enables a qualifed applicant to potentially eliminate identifcation number.
a state tax liability at less than full value. The term “tax
liability” includes EDD taxes, contributions, penalty, and b. The year(s) and quarter(s) involved.
interest.
c. The reason(s) the liability was reduced by an Offer
Reason for Compromise in Compromise.

When it is in the best interest of the state, the Director of d. The total amount of unpaid tax, interest, additions
the EDD may enter into an agreement for partial payment to tax, and penalties at issue in the compromise.
in satisfaction of the full liability.
e. The terms of the Offer in Compromise.
Practical Consideration
f. The total amount paid under the Offer in
The following requirements must be met for consideration: Compromise.

1. Applicant must not have access to income suffcient All records of compromise are kept by the EDD and may
to pay more than the accumulating interest and 6.7 be reviewed as part of the annual single audit of the EDD.
percent of the outstanding liability annually.
Full Compliance of Terms
2. Must not have prospects of increased income or
The EDD will:
assets, which allow payment within a reasonable
period. 1. Notify the individual(s) submitting the offer, in
writing, that the terms of the compromise agreement
3. Must not have assets, which if sold, would satisfy the
have been fulflled and all liens fled or recorded,
liability.
or both, against the individual’s interests have been
4. The amount offered must be more than the EDD released.
could expect to collect through involuntary means
2. Furnish the individual(s) submitting the offer with a
within four years of the time the offer is made.
copy of the statement on fle. The statement will be
Acceptance of Offer in Compromise retained for one year from the date of the issuance.

Once the terms of the compromise agreement are fulflled, Denial of Offer in Compromise
including payment of the amount offered, the following
You will receive a written notifcation if your offer is
will occur:
denied. A denial is fnal. Section 1872 of the CUIC states a
1. The liability will be considered satisfed in full. denial of an Offer in Compromise “shall not be subject to
administrative appeal or judicial review.” You may reapply
2. All tax liens fled or recorded, or both, will be in six months if a substantial and permanent change to
released. your fnancial situation occurs.

DE 999A Rev. 6 (3-20) (INTERNET) Page 3 of 4

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Terms of Rescission Specifc Instructions

The acceptance of the offer will be rescinded and all 1. The offer must be submitted on an Offer in
compromised liabilities will be reestablished without Compromise Application (DE 999A). A separate
regard to any statute of limitations if it is subsequently application must be submitted for each account to be
determined that any individual(s) willfully: compromised.

1. Concealed from any offcer or employee of the state 2. The application must be completed in full. If the
any property belonging to the estate of the individual full amount cannot be paid at the time of offer,
liable with respect to the tax. the individual may be permitted to pay the agreed
amount in installments, not to exceed a fve-
2. Received, withheld, destroyed, mutilated, or falsifed year period. The EDD will negotiate terms of the
any book(s), document(s), or record(s). installment plan during the review process.

3. Made any false statement relating to the estate or 3. This is a legal and binding agreement and must
fnancial conditions of the individual liable with be read in its entirety. The application cannot be
respect to the tax. processed without signature in all applicable areas.

4. Failed to pay any tax liability owed the EDD for any 4. Send original application to:
subsequent, active business in which the individual
who previously submitted the Offer in Compromise Employment Development Department
has a controlling interest or association. PO Box 826880, MIC 92S
Sacramento, CA 94280-0001
Upon any rescission, the EDD, at its discretion, may fle
a Notice of State Tax Lien against the individual or entity 5. Retain a copy for your records.
responsible for the previously compromised liability.
Other Facts to Know
The EDD will notify the individual who previously
The Offer in Compromise package must be completed.
submitted the Offer in Compromise in writing of the
You will be expected to provide reasonable
following:
documentation to verify your inability to pay the full
1. The rescission of any offer and reasons therefore. liability. The offer will only be successful if a legitimate
proposal is submitted in the state’s best interests.
2. The amount of liability that is due and payable.
Should you have any questions, please contact the EDD at
Collection Action 1-916-464-2739.

Submission of an offer does not automatically suspend The EDD is an equal opportunity employer/program.
collection action on a liability. Should there be any Auxiliary aids and services are available upon request to
indication that fling the offer is solely for the purpose of individuals with disabilities. Requests for services, aid,
delaying collection or will negatively impact our ability and/or alternate formats need to be made by calling
to collect the tax, collection efforts will continue. If the 1-888-745-3886 (voice) or TTY 1-800-547-9565.
EDD has previously agreed to an installment plan, those
payments must continue.

Should collection action occur after an acceptance of an
Offer in Compromise, you may receive a refund or have
the funds applied to the agreed amount.

DE 999A Rev. 6 (3-20) (INTERNET) Page 4 of 4

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