The Internal Revenue Service's (IRS) Offer in Compromise Program involves compromises on tax debts as a result of doubts about liability or collectibility. Amounts collected through the program are small relative to IRS' overall collections--$106 million in accepted offers versus about $24 billion in overall collections in fiscal year 1992. Nonetheless, the program has grown rapidly since IRS began promoting it in February 1992. IRS believes that the program improves taxpayer compliance and will boost collections but has no way of measuring whether the program is achieving these ends. Such information is crucial because the program's growth may strain IRS' collection resources and because the program could undermine voluntary compliance should taxpayers conclude that the program is too liberal. One effect of the program's growth has been added costs for IRS to investigate all taxpayer offers. The mounting number of offers and limited collection resources underscore the need for IRS to streamline the investigation of low-dollar cases, reduce inefficient manual monitoring of deferred payments receipts, and obtain authority to determine which offers need to be reviewed by legal counsel. Despite new IRS procedures clarifying its policy on offers, acceptance rates for offers continue to vary widely at IRS district offices.