If you are facing an IRS tax lien, don’t feel overwhelmed. There are affordable options to help you get relief.
Many people use tax lien and tax levy interchangeably, but there is a distinct difference between them. A tax lien is a legal claim against your property in an attempt to secure payment of your back taxes. A tax levy, however, allows the IRS to actually seize your property to satisfy the debt. A tax lien will come into play if you disregard your tax bill or refuse to pay it. When this happens, the IRS will file a public document, the Notice of Federal Tax Lien. This basically tells all other creditors that the IRS has secured a legal claim to your property. Credit bureaus may also include the notice in your credit report.
The IRS can place a tax lien not only on your existing assets, but also future assets attained while the lien is in effect. Even if you file for bankruptcy, the IRS lien may remain in place. The easiest way to remove a tax lien is to pay your taxes in full. Once paid, the IRS will release the lien within 30 days. If paying your tax debt in full is not possible, you may be able to get relief through one of these options.
If the IRS hasn’t filed a tax lien against you yet, you may avoid adverse action by setting up a guaranteed installment agreement ($10K or less) or a streamlined installment agreement ($25K or less). This allows you to make monthly payments over time to pay off your tax debt.
You may be able to reduce your tax debt through an Offer in Compromise. If successful, the IRS will remove the tax lien once the agreed-upon amount is paid in full.
An IRS tax lien is typically withdrawn when the IRS files a lien against the wrong taxpayer. If you believe a tax lien was filed in error, contact the IRS immediately and request a review.
Two additional withdrawal options are provided under the Fresh Start initiative.
The first option allows withdrawal if all of the following conditions are met:
The second option allows withdrawal if you’ve entered into a direct debit installment agreement, and you meet the following eligibility:
If you’re dealing with an IRS tax lien, don’t panic. Tax Defense Network can help. Our tax professionals have the experience and expertise to help you find the right solutions for your tax problems. Schedule a free consultation today!