Tax Services: Tax Lien

What is a Tax Lien? The IRS and state taxing agencies have the power to collect back taxes by levying on taxpayers' property as a result of a Tax Lien. When a person owes back taxes, the IRS and state agencies gain a lien on all that person's assets after meeting certain statutory requirements, which attaches to all rights, title and interest of the taxpayer. Once the IRS or a state tax agency has a lien on all of a taxpayer's assets, they may enforce it by administratively levying his or her assets.

The IRS files tax liens to protect its interests. Recorded with one or several county recorders, a tax lien basically tells the world that you owe back taxes, and is generally devastating to the taxpayer's credit. This makes it very difficult to obtain credit or to sell real estate.

The effect of the Federal Tax Lien statute is that when any person fails to pay any assessment of tax, plus interest, penalties, or costs, a tax lien in favor of the United States arises upon all property and rights to property, whether real or personal, tangible or intangible, belonging to the taxpayer. Even if the taxpayer makes partial payment, a lien will arise for the balance of the tax.

Although the taxing agencies are extremely reluctant to release or modify a tax lien, we might be able to get the government to subordinate the lien to a lender, thus allowing the client to borrow money against his assets to satisfy all or part of the IRS lien. Our tax attorney also make sure that the tax agencies have met all legal requirements for a legal tax lien filing. If any defects are discovered in this process, our tax attorney immediately appeal the filing of the tax lien.

For more information on a Tax Lien, please visit our Frequently Asked Questions and IRS Guidelines.