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Individual Tax Issues: What is a Tax Lien?

By December 8, 2016No Comments

If you owe the Internal Revenue Service (IRS) money and it deems that you have not made enough of an effort to pay, it could file a tax lien against you. This means the IRS now has a secured interest in real estate you own or other personal assets. As an unwilling lender, the IRS takes priority over other creditors.

You may disagree that you owe individual tax and ignore the tax lien. We strongly advise against this. A tax lien is certainly an aggressive collection action, but wage garnishments, tax levies, and having your bank account frozen are worse. The team at Roberts Tax Advisory will work to have the lien promptly removed from your property or other assets.

Steps the IRS Takes in Filing a Tax Lien

The IRS determines what you owe and sends you a bill before sending a Demand for Payment letter. Filing a tax lien is the next step if you ignore both the bill and the letter. The first step in this process is for the IRS to submit a Notice of Federal Tax Lien to your other creditors to inform them of its right to collect first.

An unpaid tax lien negatively affects your credit score, which means you may not be able to get new accounts or credit line increases on existing accounts. The lien also attaches to all your other assets, both current and future and including business assets. It is better to work with professional tax advisors to resolve the tax lien than have it affect you in so many ways.

We’re Here to Help, Not Judge

If you have already had a lien placed against your assets or have been informed the IRS intends to do this, please contact us for a free consultation. The sooner you do, the sooner you can put this stressful situation behind you.