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| What is a tax lien? |
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Last Updated
13th of July, 2009
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This is a type of lien (also known as a levy) placed on a property (real property or personal property) to secure the payment of taxes. This is basically a black spot that can create lasting damage to your credit. Having a tax lien on your credit reports will make it extremely difficult to get reasonable loans and interest rates. And to make matters worse, you could lose your home through a forced sale if you don’t pay the taxes. This is called a tax lien sale.
The IRS uses tax liens to seize money and assets. Tax liens can put your credit and your assets, including your home, at significant risk.
Credit Lien: The most common lien is the one placed on your credit. This is like a scarlet letter for a credit report. Your IRS debt and your failure to pay become public knowledge. With a credit lien tarnishing your credit reports, it will be next to impossible to take out a loan on a home or vehicle, initiate a lease, or do anything else credit related.
Time is of the essence; the longer you go without paying your IRS debt, the closer the IRS will get to turning a lien into a seizure, when the IRS takes away assets like homes or vehicles.
30-Day Deadline: A tax lien can be removed. The IRS must notify you that they've filed a lien within five days after it's filed. You then have thirty days from the day after the 5-day period expires to file an administrative appeal. This is no easy task, however. It’s a good idea to consult a certified tax professional. With help, you can avoid having bad credit. You can also avoid being homeless or being forced to take the bus!
The IRS will not remove a lien without a fight. If they gave you notice about your back taxes and you didn’t act, now they will want to make you pay. The lesson here is to address tax liens as a serious occurrence and do so as soon as possible, before it becomes a seizure.
If you would like additional information and assistance with your tax debt, you can get a free consultation to resolve delinquent taxes today!
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