Managing Your Money : SMALL CHANGE : Now Mr. Nice Guy, IRS Says ‘Let’s Make a Deal’

The Internal Revenue Service is trying to sell taxpayers on its new kinder, gentler image. IRS agents have been instructed to be nicer, and contrary to its well-earned tough-as-nails reputation, the IRS now says that when it comes to collecting large past-due tax bills, it is ready to wheel and deal.

The agency has instituted new, streamlined procedures on “Offers in Compromise,” which let taxpayers bargain down uncollectible tax bills.

Lower-level IRS employees now have greater power to accept these offers. There’s less paperwork, and decisions to accept or reject a compromise, which previously took up to two years, are promised in 30 days.

“If someone has a tax liability that they can’t pay, we would encourage them to come in and make us an offer,” IRS spokesman Rob Giannangeli says.

The IRS isn’t alone in its new posture. Banks and other creditors are finding it necessary to be more accommodating, thanks to hard times.

The IRS hopes its new procedures will spur more Americans to pay up, but submitting an offer is still no picnic. Experts suggest that you hire a professional to bargain with the IRS and review your liability.

You’ll also have to submit a comprehensive financial statement that shows assets, liabilities and income. The IRS usually won’t accept offers of less than it could seize if it placed tax liens on all your property.

For those who can pay in full, the IRS has also simplified a number of its tax forms, including Schedule C, for sole proprietorships. But lest you think the agency has gone soft, take note: It is moving more than 2,000 agents from auditing duties to pursuing non-filers.