Tax Lien Relief

The IRS or state taxing agencies can place a lien on real estate, vehicles, business assets, bank accounts, retirement accounts, or investments. Any property you acquire while you have a lien on your assets will also be placed under the lien.

Tax liens remain in place until you pay your debt or the IRS agrees to remove it. If you decide to file for bankruptcy, your tax lien will remain attached to any property exempted from the bankruptcy. You must negotiate release of the lien with the IRS bankruptcy unit. A lien may also pass to your estate if you pass away without resolving your tax liabilities.

A lien is a legal claim against property to secure payment of the tax debt. While this gives the IRS the rights to seize and sell your property to pay off your debt, the IRS does not immediately sell properties under a lien. A levy is the document the IRS issues when they want to garnish wages or seize a bank account or other property, even including your home, to pay a tax debt.

Explore Tax Levies

A tax lien can be released if:

• You pay your tax deficit in full.
• You enter into a certain type of installment agreement with the IRS.
• You enter into an Offer in Compromise and pay the offer in full.
• The IRS decides that releasing your lien is in the government’s best interest.

Once paid in full, the IRS releases your lien within 30 days.

You have the right to appeal your lien. Within five days of receiving the lien notice, you should get a letter informing you of your right to a Collection Due Process hearing. In this hearing, you or a tax attorney representing you can appeal the lien’s validity or request its removal. Liens can also be appealed more quickly if you file a CAP (Collection Appeals Program) appeal within 30 days of receiving notice.

Tax liens are not reported to credit bureaus and will not show up on credit reports or affect your credit score. However, they are public information, so they can show up on background checks for employment and impact your ability to obtain financing.

If you need to sell or use an asset as collateral to satisfy your tax debt, you can submit an IRS Form 14135, Application for Certificate of Discharge of Property from Federal Tax Lien, to request that the IRS discharges the lien from the asset in question.

A tax lien is a legal claim to your assets and can impact your ability to sell property, obtain credit, and even affect your business. It also remains attached to your property and can limit your financial flexibility. Liens can also make it very difficult to sell your home.

A tax lien remains in place until the debt is paid or the IRS agrees to remove it. In some cases, a tax lien may also persist after bankruptcy or even after death, transferring the responsibility to your estate or heirs.

Once paid in full, the IRS releases the lien within 30 days.

When a lien is placed on your property, it cannot be sold until the IRS is paid or the lien is removed. Until the lien is released, it can attach to any newly acquired property.

A lien can affect you in four main areas:

1. Assets
   A lien links to all of your assets, including property, vehicles, and existing financial assets like your 401(k). This also includes future assets you obtain during the lien process.
2. Credit
   A lien lets creditors know that the IRS has a legal right to your property, which will affect your ability to acquire credit.
3. Business
   A lien is also connected to your business property.
4. Bankruptcy
   If you decide to file for bankruptcy, the lien, as well as any tax deficit may continue after bankruptcy.

The IRS is required to send a notice at least 30 days prior to filing a lien. This allows you time to pay the amount due or enter into a payment agreement with the IRS.

If you still refuse or neglect to pay the taxes owed, the IRS files a public document, the Notice of Federal Tax Lien.