Once these requirements are met, a government
tax lien is created for the amount of your tax debt. By filing notice of
this government tax lien, your creditors are publicly notified that we
have a claim against all your property, including property you acquire
after the government tax lien is filed. This notice is used by courts to
establish priority in certain situations, such as bankruptcy proceedings
or sales of real estate.
The government tax lien attaches to all your property (such as your
house or car) and to all your rights to property (such as your accounts
receivable, if you are a business).
Caution!
Once a government tax lien is filed, your credit rating may be harmed.
You may not be able to get a loan to buy a house or a car, get a new
credit card, or sign a lease. Therefore it is important that you work to
resolve your tax liability as as quickly as possible, before government
tax lien filing becomes necessary.
Releasing a government tax lien
We will issue a Release of the Notice of Federal Tax government tax
lien:
Within 30 days after you satisfy the tax due (including interest and
other additions) by paying the debt or by having it adjusted, or
Within 30 days after we accept a bond that you submit, guaranteeing
payment of the debt.
In addition, you must pay all fees that a state or other jurisdiction
charges to file and release the government tax lien. These fees will be
added to the amount you owe. Refer to
Publication 1450, Request for Release of Federal Tax government tax
lien.
Usually 10 years after a tax is assessed, a government tax lien releases
automatically if we have not filed it again. If we knowingly or
negligently do not release a Notice of Federal Tax government tax lien
when it should be released, you may sue the federal government, but not
IRS employees, for damages.
Payoff Amount
The full amount of your government tax lien will remain a matter of
public record until it is paid in full. However, at any time, you may
request an updated government tax lien payoff amount to show the
remaining balance due. An IRS employee (either over the toll-free
customer service telephone line, or at a walk-in service site, or at
your local IRS’ government tax lien desk) can issue you a letter with
the current amount due in order to release a government tax lien.
Applying for a Discharge of a Federal Tax government tax lien
If you are giving up ownership of property, such as when you sell your
home, you may apply for a Certificate of Discharge. Each application for
a discharge of a tax government tax lien releases the effects of the
government tax lien against one piece of property. Note that when
certain conditions exist, a third party may also request a Certificate
of Discharge. If you're selling your primary residence, you may apply
for a taxpayer relocation expense allowance. Certain conditions and
limitations apply. Refer to Publication 783,
Instructions on How to Apply for a Certificate of Discharge of Property
from the Federal Tax government tax lien.
Making the IRS government tax lien Secondary to Another government
tax lien
In some cases, a federal tax government tax lien can be made secondary
to another government tax lien. That process is called subordination.
Refer to Publication 784, How to Prepare
Application for Certificate of Subordination of Federal Tax government
tax lien.
Withdrawing government tax liens
By law, a filed notice of tax government tax lien can be withdrawn if:
The notice was filed too soon or not according to IRS procedures,
You entered into an installment agreement to pay the debt on the notice
of government tax lien (unless the agreement provides otherwise),
Withdrawal will speed collecting the tax, or
Withdrawal would be in your best interest (as determined by the Taxpayer
Advocate), and in the best interest of the government.
We will give you a copy of the withdrawal, and if you write to us, we
will send a copy to other institutions you name.
Appealing the Filing of a government tax lien
The law requires us to notify you in writing not more than 5 business
days after the filing of a government tax lien. We may give you this
notice in person, leave it at your home or your usual place of business,
or send it by certified or registered mail to your last known address.
You may ask an IRS manager to review your case, and you may request a
Collection Due Process hearing with the Office of Appeals by filing a
request for a hearing with the office listed on your notice. You must
file your request by the date shown on your notice. Some of the issues
you may discuss include:
You paid all you owed before we filed the government tax lien,
We assessed the tax and filed the government tax lien when you were in
bankruptcy, and subject to the automatic stay during bankruptcy,
We made a procedural error in an assessment,
The time to collect the tax (called the statute of limitations) expired
before we filed the government tax lien,
You did not have an opportunity to dispute the assessed liability,
You wish to discuss the collection options, or
You wish to make spousal defenses.
At the conclusion of your Collection Due Process hearing, the IRS Office
of Appeals will issue a determination. That determination may support
the continued existence of the filed federal tax government tax lien or
it may determine that the government tax lien should be released or
withdrawn. If you disagree with Appeal's determination, there is a
30-day period starting with the date of determination, in which you may
request judicial review in a court of proper jurisdiction. Refer to
Publication 1660, Collection Appeal
Rights, for more information.
Related
Articles:
Government Tax Lien
Tax Collection
Tax Payment Options
Offers In Compromise
