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You have probably heard of IRS tax liens from family and friends. It is a harmful tool that the IRS utilize to seize properties and money. To add it up, tax liens would surely make a mess out of your credit. The serious dangers of an IRS tax lien are only known by few. So, it would be smart to educate yourself on this matter. Do not take it for granted. Plus, do not let your assets be taken away from you and end up with a ruined credit report.
Always be prepared when facing a lien. Take note that the IRS would not remove a lien unless you have made the payments. Do not ignore their notices. Act on it quickly or see your credit crashing down. Avoid being homeless and settle your debt before the specified period of time.
When you face tax problems, it can be very daunting to have a tax lien imposed against your property. Not to mention so confusing especially if this term is new to your ears. So, you need to find out what a tax lien exactly means. Also, check out how a tax professional can help in reaching a good agreement with the Internal Revenue Service, to alleviate your tax debt problems.
Paying the taxes is something that you need to deal with in order to live a comfortable life. But even the most law abiding citizen find the tax code confusing at times. Furthermore, in some cases, this confusion lead to costly mistakes that makes a person forget of paying taxes to the government. This careless action is going to show up as a red flag to the Internet Revenue Service, for missing tax returns or no payment at all. The IRS would come to collect the tax debt together with any interest and penalties incurred along the way.
The IRS has every legal right to do any means necessary to get their money from delinquent taxpayers. They would sell the properties of those owners in a tax deed auction or tax lien sale. Then, the money from the sale would be used to cover back taxes. So, better pay the taxes diligently or reach a tax settlement in order to resolve such issues.
If you owe the Internal Revenue Service back taxes, a Collection Appeal can be filed within the stated rules and certain time frame. You can do this if there was bank levy, tax lien, or wage garnishment threatened against you. The Collection of Appeal is going to be assigned to an officer who would be required to make an important decision within 5 days. You can refer this to a tax lawyer or a specialist if you’ve got some questions in mind. Also, they know how to deal with this kind of dilemma.
If you do not know yet the rules regarding these problems, the tax specialists can take care of it. The IRS holds some of the advantages and knows the rules governing a tax lien, wage garnishment, or bank levy. So, if you owe back taxes and have received collection notices from the IRS, and do not have the proper knowledge, do not hesitate to ask assistance from tax specialists. They would gladly handle your case and ensure that your tax problems would go away. Their services come with a fee of course.
An IRS tax lien is filed against a delinquent taxpayer, business, or assets because of owed back taxes. The federal government uses this in order to make the delinquent taxpayer do something about his tax problems, and resolve it. Tax liens can seize a property as well as freeze assets. It is advised to seek professional tax assistance if this scenario happens.
So why are tax liens not good to a taxpayer’s credit report and properties? Here are the reasons:
a. Liens show up in a credit report and also in a public record which anybody can view.
b. The opportunity of getting to finance a home or a car would be denied if you have a lien on record.
c. Also, the chances of selling or transferring a property are slim if a lien is filed against you.
As you see, an IRS tax lien can have devastating effects in your credit report. It is best to settle any tax debts you have with the government in order to be free of a bad public record.
A recorded tax lien could be the end to a taxpayer’s credit rating. It may prevent your ability to finance or sell real estate property. However, it cannot affect your right to sell vehicles, jewelries, and other personal properties. So, avoid tax lien in the first place. This is the best way of dealing it.
Tax lien may just be a red mark on the credit report for some people. However, once you receive an IRS letter for the lien, you must respond to it right away. Contact the IRS immediately with the contact number/s provided on the letter of notice. Explain to them that a tax lien eliminates your chances of getting a bank loan or any other transaction that needs credit. But if you fail to convince the IRS to prevent the recording of the lien, here are some options after its filing:
Pay the full amount of tax debt owed. If you do this quickly, the IRS can then record a release of the lien within thirty days of full payment.
It is recommended to file an appeal against the lien. A written notice would be provided to the taxpayer by the IRS after filing of the lien. They do this in five business days. There would also be a notice of your right to request a hearing within thirty days, after the filing of lien on the sixth day. The lien would only be withdrawn if you win the appeal. So, act quickly if you want to be free from IRS tax lien listings.
Partial Discharge Request
If you have several properties that are hampered by the lien, you can use them to pay the IRS for your debt. The IRS would likely do this if you ask for a discharge from the lien.
Did you know that IRS tax liens on a credit report cause serious damage? It can remain even after paying the tax debt. It also hinders a person to purchase things using credit. This is the reason why tax debt must be avoided as much as possible.
Here are some commonly asked questions and answers in regards to IRS tax liens:
What are IRS tax liens?
Through the Internal Revenue Service, the Federal government places a claim against your property for failure of tax payments. This claim is called IRS tax liens. However, before the IRS can file the lien against your property, you’re going to receive a notice of payment due. You must act on this immediately. For the tax amount owed, the IRS would continue the lien especially if you fail to pay your debt after 10 days notice. The lien applies to all your personal properties like vehicle, home, and businesses. Your credit score would also be affected.
How to prevent an IRS tax lien?
IRS tax lien can be prevented by paying taxes on time. This is the best way of doing it.
How to remove a tax lien?
Pay the full amount of money owed to the government immediately and it would be dropped. Another way is to offer in compromise in full. If you’re going to agree with the IRS terms of payment plan, then the lien would dropped as soon as full payment is reached.
The IRS can use the tax lien against you for failure to pay taxes. This is why it is highly advisable to pay in full and immediately in order to keep a clean credit rating, and avoid losing your home.
Have you ever experienced facing a lien? If not yet, then better avoid it as much as possible. It is because there are bad consequences to having a tax lien filed against your property. These include a negative impact on your ability to qualify for a loan, and your credit score is also greatly affected. Furthermore, the filing would pile up in your credit report and would remain until the tax debt is paid soon. The Internal Revenue Service tax lien on your property would top all other claims. This gives the IRS a higher priority over the other creditors. If you have come to a decision to file a bankruptcy, the government is going to get their money out of the proceeds of your assets, when it is all liquidated.
You must take note that IRS tax liens tend to expire after ten years. The ten year period does not begin during the time of the lien being filed, but starts at the time when you’ve owed them the tax debt. Court action and bankruptcy can extend the ten year time frame though. However, the IRS can file again for a lien extension after the ten years is up. They are given 30 days to do this or lose the opportunity.
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