A federal tax lien, or Internal Revenue Service (IRS) tax lien, results from a person’s failure to pay any portion of federal taxes, such as income and withholding taxes.
A Lien is the legal claim of one person or entity upon the property of another person or entity in order to secure the payment of a debt or financial obligation.
If the taxpayer does not pay a tax liability in full and fails to work with the IRS to find an alternative method to pay the tax, the IRS may file a Notice of Tax Lien against the taxpayer’s property.Â By filing a lien, the IRS is making a legal claim to the taxpayer’s property as security for payment for the tax debt.
The IRS may only file a Federal Tax Lien after:
* It assesses the liability
* It sends a Notice and Demand for Payment (a bill that tells the taxpayer how much Â
Â Â the taxpayer owe in taxes)
* The taxpayer neglects or refuses to fully pay the debt within 10 days after the IRS
Â Â notifies the taxpayer about it.
What kind of property does a lien involve?
Some of the most significant examples of vulnerable property are your house and car.
If you own a business, even your accounts receivable are susceptible to a tax lien. Property obtained after the lien is filed is also subject to the lien!
Tax liens, filed through county clerks in the county where you live or where you do business, are public records stating that you have an outstanding federal or state tax debt.
Tax liens can be a real problem for several reasons:
* They can make it very hard for you to secure credit and borrow against yourÂ
* Tax liens may also make it difficult for you to be approved for an auto loan. They
Â Â can also make it hard for you to sell your property as long as the lien appears on
Â Â your public record.
The IRS will issue a Release of the Notice of Federal Tax Lien. Within 30 days after the taxpayer satisfies the tax due (including interest and other additions) by paying the debt or by having it adjusted, or Within 30 days after it accepts a bond that the taxpayer submits, guaranteeing payment of the debt.
In addition, the taxpayer must pay all fees that a state or other jurisdiction charges the taxpayer to file and release the lien. These fees will be added to the amount the taxpayer owes.
The full amount of the taxpayerâ€™s lien will remain a matter of public record until it is paid in full. However, at any time the taxpayer may request an updated lien payoff amount to show the remaining balance due. An IRS employee can issue the taxpayer a letter with the current amount due in order to release a lien.
It is urgent that you respond immediately to keep these aggressive collection actions from devastating your credit, bank accounts, and income.
With over 12 years of combined experience, we know what it takes to remove all IRS tax liens. Tax Relief Providers can definitely help.
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Do you need Tax Relief?
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