Tax Lien Removal: Releasing, Withdrawing, and Discharging IRS Liens

A federal tax lien is the government's legal claim against all of your property and rights to property, including certain after-acquired property, that arises after the IRS assesses a tax and you fail to pay after notice and demand.

When the IRS files a public Notice of Federal Tax Lien, it can complicate selling property, refinancing, or borrowing. The good news is that a lien is not permanent, and depending on your goal, there is more than one way to remove or reduce its effect: full release, withdrawal of the public notice, discharge of a specific piece of property, or subordination to another lender.

Whiteford helps individuals and businesses choose the right remedy and get an IRS tax lien resolved, as part of the firm's broader IRS collections practice.

What a federal tax lien does

A federal tax lien arises automatically once the IRS assesses a tax and you fail to pay after demand. It attaches to all of your property and future property. When the IRS files a public Notice of Federal Tax Lien, it establishes the government's priority ahead of many other creditors and becomes a matter of public record.

One point that is often reported inaccurately: since 2018, the major consumer credit bureaus no longer include tax liens on consumer credit reports, so a lien will not directly lower your credit score. It remains a public record, however, and can still surface in title searches and lending decisions, which is why removing it matters when you want to sell, refinance, or borrow.

Ways to remove or reduce a tax lien

Release

A lien is released when the underlying liability is paid, otherwise satisfied, or becomes legally unenforceable, or when an acceptable bond is posted. When that happens, the law requires the IRS to issue a Certificate of Release, generally within 30 days. Release is the complete answer, but it is not the only one when the balance is not yet fully paid.

Withdrawal

Our attorneys can help remove the public Notice of Federal Tax Lien, as if it had not been filed, which can matter even while a balance remains. The IRS may, in its discretion, withdraw a notice in defined circumstances, including when you enter a qualifying installment agreement, or when withdrawal will facilitate collection or is otherwise in the best interests of both you and the government. Withdrawal addresses the public-record problem directly.

Discharge of specific property

A discharge removes the lien from one particular piece of property while leaving it in place elsewhere. This is the tool that lets you sell a specific property, for example a home, when a lien would otherwise block the sale, often by directing the proceeds to the IRS or showing the government's interest is protected.

Subordination

Subordination does not remove the lien but allows another creditor to move ahead of the IRS. It is what may make a refinance situation possible, because a new lender will usually not lend behind a federal tax lien without being placed in a superior position.

Which option fits your goal

The right remedy depends on what you are trying to do. If the debt is resolved, you want a release. If a balance remains but the public notice is the problem, withdrawal may fit, often paired with an installment agreement. If you need to sell one property, discharge typically is the tool; if you need to refinance, subordination typically is.

We match the remedy to the outcome you need and prepare the application the IRS requires, which each of these involves.

How a tax attorney can help

Each lien remedy has its own IRS application, documentation, and timing, and choosing the wrong one wastes time you may not have before a closing or refinance. A tax attorney identifies the remedy that fits your goal, prepares and supports the request, and ties it to a broader resolution of the underlying tax so the lien problem does not simply recur. We also coordinate with lenders, title companies, and buyers when a transaction is on the line.

Why Whiteford

Whiteford's tax controversy practice has experience resolving IRS collection matters, including liens, as part of the full range of resolution options, and the firm has a record of resolving audits, appeals, and collection disputes on favorable terms. The practice is led by attorney Michael March, who focuses on tax controversy and defense. Because a lien is a symptom of an underlying balance, we address both the lien and the debt behind it.