TC 482: Offer in Compromise Withdrawn or Terminated

What the code actually does

TC 482 records the withdrawal or termination of a pending Offer in Compromise. A withdrawal can be voluntary — the taxpayer pulled the offer back — or involuntary, which under IRM 5.8.7.1.6, Terms/Definitions/Acronyms specifically means the taxpayer missed a required TIPRA payment (the mandatory payment TIPRA — the Tax Increase Prevention and Reconciliation Act of 2005 — requires while an offer is pending) and the IRS closed the offer on that basis (and, if that closure turns out to be IRS error — a payment actually received but not posted in time, for instance — the offer is reopenable with a new TC 480 date per IRM 5.8.7.4.2.1, Reopening an Involuntary Withdrawal (IRS Error)). A termination is narrower still: per IRM 5.8.7.1.6, it means specifically that the taxpayer died during the offer’s pendency, not any IRS-initiated closure for cause — a closure over a missed condition or noncompliance is a return instead, which closes under TC 481, not TC 482. Like TC 481, TC 482 ends the TC 480 pending status and restarts both statute clocks that paused while the offer was active: the ASED (Assessment Statute Expiration Date — the deadline for the IRS to bill more) and the CSED (Collection Statute Expiration Date — the deadline to collect what is already billed).

The ASED extension — now confirmed, not assumed

The current IRM resolves what was previously a genuinely open question. IRM 5.8.10.8(5) states the general rule covering all four offer outcomes together: "For an offer that has been rejected, returned (processable), terminated or withdrawn, the amount of any federal tax due for a tax period included on the offer may be assessed on the latest allowable assessment date plus the period of time the offer is pending, plus one year." The Form 656 (Rev. March 2011 or later) table backs this with a dedicated TC 482 row, parallel to and worded the same way as the TC 481 row: the ASED extends from the TC 480 date to the TC 482 date, plus one additional year.

Under an older, superseded Form 656 table (May 2001–March 2009), a withdrawn offer got only the base pendency period without the extra year — but that version does not govern current offers, and should not be applied to one by habit or by pulling an old reference.

The CSED extension — a real asymmetry worth naming

IRM 5.8.10.7, the collection-statute chart, is written entirely in terms of a rejected offer (TC 481) and contains no row naming TC 482 specifically. That does not mean a withdrawn or terminated offer leaves the CSED untouched — the pendency-plus-30-days policy applies as a matter of the same 2002 Job Creation and Workers Assistance Act framework that governs rejections — but the primary source states it with less explicit precision on the CSED side than it does on the ASED side. Recompute the CSED from the actual TC 480/482 dates rather than assuming the ASED table’s explicitness carries over automatically.

The practitioner’s actual next step

Apply the same one-year ASED extension to a TC 482 that you would to a TC 481 — current IRM text and the Form 656 table both confirm this directly, so there is no reason to treat a withdrawn offer as carrying a lighter statute consequence.

Recompute the CSED carefully given the chart’s asymmetry, using The Federal Tax Desk’s CSED Calculator rather than estimating; when in doubt, verify the actual extended date against the transcript rather than the general policy statement alone.

On a business account, the same trust-fund-recovery-penalty carve-out that applies to TC 481 applies here — the underlying business assessment statute extends, but the separate TFRP assessment statute against a responsible individual does not.

If recomputing the CSED or ASED surfaces a prior miscalculation on an existing or former client’s file, treat it as a potential claim circumstance, not just a data correction — most claims-made E&O policies require prompt notice to the carrier once a practitioner becomes aware of a possible error, independent of whether the client has complained; terms vary by carrier, so confirm the specific notice trigger in the practitioner’s own policy.

What TC 482 gets confused with

TC 482 and TC 481 are close enough in statute effect that treating them as identical is usually harmless — and, as this page shows, that instinct is now correct on the ASED side specifically. Where it is worth being precise is explaining to a client why an offer ended: a rejection or return (481) is the IRS declining or closing the offer on procedural or merits grounds; a withdrawal (482) means the taxpayer — or, in an involuntary withdrawal, the IRS itself — pulled the offer back; a termination (482) is narrower still, tied specifically to the taxpayer’s death during the offer’s pendency. Those are different conversations about what happened, even though the statute math converges on the same result. Whichever of these closed the offer, the IRS still gets the same extra year to assess. Appeal rights don’t follow the same symmetry: a rejection carries an explicit 30-day path to the IRS Independent Office of Appeals; a taxpayer who receives an involuntary-withdrawal letter can telephone to object to the closing; and a termination, following the taxpayer’s death, raises a different question this page does not resolve — who besides the taxpayer, such as an estate or executor, may have standing to contest the closure.