If you have any tax debt you owe to the federal government, whether it is due to delinquent paying of real property taxes, or personal property taxes or income taxes, or other taxes, the IRS can file a tax lien against any and all property you own. Though the filing of a tax lien is based on a discretionary statute, the IRS usually employs this technique even if it harms your ability to pay the debt. And IRS tax liens don't go away until you pay the tax you owe, and once paid, they remain on your credit rating for 7 years.
Federal Tax Lien Information:
Once the federal government files a federal tax lien against your property they have a legal claim to it as security for your tax debt. It attaches to all your property, including house and car, and any rights you have to property, such as accounts receivable if you own a business.
The IRS must complete the following steps before it can file A Notice of Federal Tax Lien:
- Assess the tax lien liability;
- Send you a Notice and Demand for Payment, which will tell you how much you owe in taxes; and
- You must neglect or refuse to fully pay the tax lien debt within 10 days after the IRS notifies you of it.
After completing these requirements the IRS may create a tax lean in the amount of the taxes you owe. By filing A Notice of Federal Tax Lien your creditors are publicly made aware that the IRS has a claim against your personal property. This includes property you acquire after the IRS tax lien is filed. Courts use this notice to establish priority when situations warrant it, such as when bankruptcy occurs, or there is a sale of real estate.
Appealing the Filing of a Federal Tax Lien
By law, the IRS has no more than 5 business days in which to notify you, in writing, that they haved filed a federal tax lien. this notice may be done in person, or left at your home or place of business, or it may be sent to you by certified/registered mail to your last known mailing address.
You are allowed to ask an IRS manager to review your case. You may also request a Collection Due Process hearing by filing a request for hearing with the office listed on your federal tax lien notice. You have until the date give on your federal tax lien notice to file your request. Issues you may wish to discuss with the IRS include:
The fact that you already paid the amount you owed prior to the IRS filing the federal tax lien,
- You were in bankruptcy, and under the protection of the automatic stay when the IRS assessed the tax and filed the tax lien,
- The IRS made a procedural error in an assessment,
- Before the IRS filed the tax lien, the time limit to collect the federal tax had lapsed, falling under the statute of limitations,
- You were not given the opportunity to dispute the assessed tax lien liability,
- You would like to discuss the tax lien collection options, or
- You have spousal defenses you would like to make.
Once the Collection Due Process hearing is completed, the IRS Office of Appeals will issue its determination on your federal tax lien. It may decide to release the tax lien and completely withdraw, or it may support the continued existence of the federal tax lien. In any case, should you disagree with its decision you have a 30-day period of time from the date of determination, in which you may request a judicial review of the determination with the court of jurisdiction.
Seek Professional Advice
If you are personally involved in a case where the federal government may place a lien on your property, you will want to contact a professional tax attorney. There are always issues with the tax code you may be unaware of which can greatly influence your case. Only a professional will be able to guide you to a successful conclusion.
