If you owe back taxes you can expect the IRS to file a Notice of Federal Tax Lien. The IRS generally files a Notice of Federal Tax lien when you owe more than $10,000 in back taxes, have received demand for payment and haven’t taken appropriate action to resolve the matter. A tax lien is essentially the IRS’s claim against your property as a way of ensuring that you pay your back taxes.
Did you know that IRS tax liens are a matter of public record? Once a lien is filed, your creditors are notified that the IRS has a claim against your property. The lien attaches to all your property including real or personal property, intangible property or any rights to property you may have. An IRS lien will attach to such property as your home or car, bank accounts, wages, retirement plan benefits, or even an inheritance. So, if you decide to sell your home the IRS will take the unpaid back taxes from any sales proceeds remaining after payment of the mortgage.
Once a lien is filed it will show on your credit report and cause a substantial drop in your credit score, making it difficult to obtain a loan and require you to pay a higher interest rate. If you pay your tax debt in full and the lien is released, your credit report will indicate that the lien has been satisfied, but the original filing of the tax lien remains on your credit report for many years after it is released. This will continue to harm your credit score. If you need tax lien help, our tax specialists at know how to have the tax lien withdrawn by the IRS and removed by the credit agencies from your credit report. This means that the credit agencies will delete any reference to the tax lien from your credit history, as if the lien was never filed, resulting in a considerable increase in your credit score.
A Notice of Federal Tax Lien may be withdrawn by the IRS before you make full payment if:
- The notice was not filed in accordance to IRS procedures or it was filed prematurely
- You owe $25,000 or less and make three consecutive direct debit payments on your installment agreement
- Withdrawal would help you pay the taxes faster
- Withdrawal would be in the best interest of both you and the government
The IRS will release a tax lien if one of the following events occur:
- Your back taxes are paid in full
- The period during which the IRS is allowed to collect your unpaid taxes has expired
- You have completed the terms of your Offer in Compromise
If you have received a Notice of Federal Tax Lien you need tax lien help to develop a plan of action to resolve your back taxes. Ignoring a tax lien will only make the situation worse; including the possibility the IRS will levy your bank account or garnish your wages.
Call us today for help with a Tax Lien Release!
With over 30 years of experience, our tax professionals are here to help you obtain relief from your tax problems. Let our team of CPAs help settle your tax debt for the lowest amount permitted and solve IRS problems such as bank levy, IRS audits, wage garnishments, unfiled tax returns, IRS liens and payroll tax penalties. Proudly serving taxpayers in Boca Raton, Florida and elsewhere throughout the U.S. Call for your Free Consultation today!