What to Do When You Receive IRS Tax Lien Notification
If you have received IRS notification regarding a tax lien, it is important to take immediate action. Wiggam Law tax attorneys can assist you in resolving the lien.
What Is a Tax Lien?
When a taxpayer refuses to or cannot pay tax debt, the IRS places a lien on property until the taxes are paid. A lien can be placed on property, such as real estate, jewelry, cars, antiques, artwork, or any valuable asset.
What Happens When the IRS Places a Lien on Your Property?
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:
- Assets
A lien links to all of your assets, including property and vehicles, as well as any future assets that you obtain during the lien. - Credit
A lien lets creditors know that the IRS has a legal right to your property, which will affect your ability to acquire credit. - Business
A lien is also connected to your business property. - 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.
Lien vs. Levy
A lien is a legal claim against property to secure payment of the tax debt, which gives the IRS rights to use proceeds from the sale of the property to pay off a tax debt. A levy is the document the IRS issues when they want to garnish wages or seize a bank account or other property to pay a tax debt.
It’s Best to Act Quickly
You have the right to appeal a lien, but must quickly take action. Within five days of the lien filing notice, you should receive a letter from the IRS titled Notice of Federal Tax Lien Filing and Your Right to a Collection Due Process Hearing.
The notice will include a deadline by which a request for a hearing can be filed with the IRS’s Appeals Office. At that point, the Appeals Office will determine whether the notice should remain filed, or be withdrawn or released.
Wiggam Law tax attorneys are well versed in this process, advising you through each step.
When Is a Lien Released?
A lien can be released when:
- The tax deficit is paid in full.
- The taxpayer has entered into a certain type of installment agreement with the IRS.
- The IRS accepts an offer in compromise from the taxpayer and the offer is paid in full.
- The IRS deems the release to be in the best interests of the government.
There are a number of ways to address a lien with the IRS. However, it can be difficult to know what forms to file or even where to find the information you need in order to make progress. Unfortunately, even if you die, tax liens stay attached to your assets, and then, they become the responsibility of your estate or the people who inherit your assets.
Wiggam tax attorneys are experienced at resolving your lien issues, such as obtaining federal lien discharges and federal lien withdrawals.
Contact Our Tax Attorneys in Atlanta, GA
If you need help with liens, call Wiggam Law to talk with an experienced tax lawyer at 404-233-9800 or complete the form to schedule a consultation.