When you owe federal taxes to the Internal Revenue Services (IRS), they can try to ensure that your taxes will be paid by filing a lien in the county where you reside against your property. A federal tax lien is a broad lien that can attach to all of the taxpayer’s property. This blog discusses what you need to know about federal tax liens and how to deal with them if the government has attached one to your property.
What Is a Federal Tax Lien
A tax lien is a claim that the IRS can attach to certain property to satisfy your tax liability. The lien remains on that property until you, the taxpayer, satisfy the tax debt. Tax liens also give the IRS authority to take the property to which the lien was attached in the event the taxpayer fails to pay. In essence, a tax lien turns your property into security for outstanding tax debts.
Tax liens also have the potential to negatively impact your credit score, because tax liens are recorded on official records for the county in which the taxpayer resides. Tax liens can be seen as a factor that negatively impacts the taxpayer’s ability to repay money to creditors. As a result, recorded tax liens can result in what is known as a “derogatory mark” on your credit report.
How to Deal with a Federal Tax Lien
If the IRS filed a tax lien in error, or if the tax debt was fully repaid or otherwise satisfied – such as through an offer in compromise – the lien will become unenforceable and may be removed. There are two types of lien removal procedures: lien withdrawal and lien release.
Lien Withdrawal
Removing a federal tax lien using withdrawal procedures means that the IRS will act as though the lien was never filed to begin with. This procedure is typically reserved for liens that were erroneously filed by the IRS. Withdrawal procedures begin by contacting the IRS so they can review your taxpayer history to confirm that the lien was made in error.
Lien Release
The IRS may also detach a tax lien from the property it encumbered, under certain circumstances. Typically, lien release procedures follow the successful payment in full of the taxpayer’s outstanding tax debt. However, release procedures can also apply when doing so would be in the best interests of the taxpayer and the federal government.
Contact a Knowledgeable Tax Attorney to Help Resolve Your Issues
If the IRS attached a lien to your property, you should consult an experienced tax attorney in Oklahoma today. At Eagleton, Eagleton, & Harrison, Inc., we have more than eight decades of combined legal experience assisting Tulsa residents in resolving their tax issues, including dealing with tax liens. Led by Attorney Charles D. Harrison, our legal team is committed to making sure your property and rights are adequately protected when it comes to tax issues.
Call us at (918) 584-0462 or contact us online to arrange a consultation with our skilled tax attorney about your legal rights and options today.