All the information you need to make an educated decision
A Notice of Federal Tax Lien gives the Internal Revenue Service (IRS) legal ownership over your property as payment for tax liability. The tax lien certificate may be filed if and only if (1) the IRS assesses your tax debt, (2) the IRS notifies you and sends a demand for payment, and (3) you do not respond in payment within 10 days of notification.
The tax lien certificate grants legal claim to the IRS over all of your property and removes your rights to the property. Your creditors will be notified of the lien, and your credit rating may be harmed. You likely will have difficulty securing a loan.
Tax Lien Release
Fortunately, the notice is in place only until you take action to release it. Your Notice of Federal Tax Lien will be released within 30 days if you pay your debt, have it adjusted appropriately, or provide an accepted bond that guarantees payment.
A lien can be withdrawn if it is determined that the filing was not done according to procedure, if you elect to participate in a payment plan upon the filing of the lien, if payment can be made more quickly otherwise, or if it would be in the best interest of both you and the IRS to do so. Additionally, you have the right to appeal the filing.
You do not want to find yourself with a Notice of Federal Tax Lien over your property. If you do, it is in your best interest to have it released as soon as possible. For help in releasing your lien, or in preventing such a situation altogether, businesses in the DebtHelp network are here to offer their expert advice.
In very serious, ongoing cases of tax debt, the IRS may utilize property seizure. When the IRS believes that monetary value can be obtained from your asset(s), it will determine how much equity is in an item such as a car, boat or home. If the equity is over 20%, your property may be taken and sold at an auction as payment for your debt.
Property seizure is not very common nowadays, as it is often not valuable. If you own a home worth $100,000 with a $90,000 mortgage, for example, then the equity is low and seizing it might not be worthwhile. Home and business seizures in particular are especially rare, but they DO happen.
If you receive a notice of seizure, or if you think that your debt situation may be leading to such action, you should contact a tax professional. On DebtHelp.com, you can find a company on our extensive network that will work for you, to find your debt solution.
A bank levy essentially funnels the money in your bank account(s) to the IRS. When the IRS serves a levy to your financial institution, all of the money in your account(s) at that moment, up to the amount that you owe in tax debt, is removed by the bank. Leaving you little or nothing, the bank must send this money to the IRS. Even the interest earned during the transition time must be sent.
It is very difficult to get a refund after your money has been seized by the IRS. Fortunately, there is a holding period of 21 days before the bank sends your money, during which time it is crucial that you work with a tax expert to implement a new solution for reconciling your tax debt.
A bank levy can be devastating to your everyday life. Within our network of resources and expert advice at DebtHelp.com, you can find a company or agent to help you prevent a levy on your accounts, release a levy within the holding period, or attempt to retrieve your money from the IRS.