The Internal Revenue Service (IRS) has many tools it can use to collect tax obligations, and liens are one of them. As long as there is a lien on the property, it cannot be sold or refinanced.
Receiving a notice that the government has put a lien on your assets can be upsetting, but it is important to understand that there are ways out of this. A Richmond IRS lien lawyer can answer your questions and help you explore your resolution options.
A lien is the government’s claim against your property when you fail to pay a tax debt. The IRS can attach a lien to property like your home or vehicles, which can make it impossible to refinance or sell them as long as the lien is in place. There are other consequences of having a lien, like damage to your credit score.
You should not confuse a lien with a levy. While a lien is a claim on your property, a levy is the government’s effort to seize the asset. If the IRS places a levy on your bank account, it can take that money and use it to satisfy your tax debts. A Richmond IRS lien attorney can answer your questions about how to deal with your debt and address the lien.
Liens can be frustrating, but there are different ways you might be able to release them. A Richmond IRS liens attorney could help with the following:
The simplest way to get rid of a lien on your property is to pay the tax debt in full. As soon as the balance is reduced to zero, the IRS will remove any liens they have on your property. Of course, most people facing tax debts do not have the liquid assets to pay the obligation in full.
If you are like most people, paying the full balance you owe to the IRS in one go is not possible. The government takes this into account, which is why they often agree to installment agreements where you can make monthly payments. Usually, the IRS will lift any liens as long as you meet certain conditions.
An offer in compromise works exactly like paying in full in that it closes out any liens. The big difference is that instead of paying the full amount of what you owe, you pay an agreed-upon percentage. The IRS will only take less than its owed in certain situations, but when they do, that payment will wipe out any existing liens.
In some cases, you might be able to have a lien discharged by the IRS. This does not erase your debt to the IRS, but it does lift the lien on a specific asset. Discharging the property will let you sell it and potentially use that money to pay your back taxes.
Another helpful option for dealing with an IRS lien is subordination. In general, the IRS is your highest priority creditor, meaning you need to take care of their lien first if you try to sell your property. Subordination allows another creditor to take their place in the pecking order. Taxpayers usually do this with their mortgage lenders as part of the sale of their home.
Liens are confusing, but you do not have to deal with them alone. In most cases, having an attorney by your side can ensure you get your questions answered and your options explained. Call to set up a private consultation with a Richmond IRS lien lawyer today.