- Quick Sale Value (80% of the actual value)
- Take value x 80% and deduct secured liens.
- $6,250 for personal effects.
- $3,125 for tools of the trade.
- If taxpayer cannot touch now; then not an asset to IRS
- If taxpayer CAN touch (401(k); IRA), then full value IS an asset.
If taxpayer intends to use the pension plan to fund OFFER
- In that case, deduct the penalties and taxes that will need to be paid from the value of the asset.
- IT IS MOST COMMON TO USE A WITHDRAWAL FROM A PENSION PLAN TO FUND THE OFFER.
- IRS will require that the taxpayer pays an amount from excess income.
- 48 months’ worth if cash offer;
- 60 months with If a short-term deferred offer payable over 24 months.