Received A Notice of Federal Tax Lien

Federal Tax Liens Attached to Your House and All Your Property

The Internal Revenue System (IRS) issues tax liens against your property when your income taxes are delinquent. The IRS does not have to file a complaint in court and obtain a judgment before the lien attaches. They just file the lien and it is done. That is efficient and actually pretty cruel.

I Don’t Own Real Estate in the State the Lien was Filed

Many people believe the lien is against their real estate because it is normally filed in the land records office. So they mistakenly believe that it only attaches to their real estate in that county. Wrong. It attaches to ALL of your real estate WHEREVER located within the United States. And it attaches to the real estate you acquire after the lien is filed.

I Don’t Own Any Real Estate for the Lien to Attach To

So you don’t own any real estate. No need to worry, right?  Wrong.  Even if you don’t own any real estate the federal tax lien attaches to all your property. That’s right, all of you property, including property you obtain a year from now. Included are your earnings, cars, savings accounts, and even household items. The federal tax lien pretty much places a net over everything you own and are going to own.

What About My Due Process Rights?

Although there is no requirement for a court proceeding, your due process rights have not been violated. The IRS does follow specific procedures to collect the tax debt before resorting to the Federal Tax Lien. You will likely receive many notices from the IRS notifying you of their intent to collect a tax debt. You will even receive a notice of their intention to levy (put a lien on your property) that gives you one last opportunity to work with them prior to issuing the lien. In most cases your due process rights have been protected.

How Do I Deal With Collections of Federal Taxes?

Like most matters, you can always try on your own. The process is complicated and requires that you properly prepare and file many complicated documents. Errors on these documents could be costly.

You could consider filing bankruptcy. Contrary to popular belief, certain taxes in certain circumstances can be discharged. If you have other pressing debt, bankruptcy might be a very good option.

You can retain a competent professional who understands the complex nature of the forms and the proper classification of income, assets, liabilities, and necessary expenses. A tax profession can negotiate with the Internal Revenue Service and seek a number of remedies, such as affordable installment agreements, offers in compromise, and obtaining non-collectible status.

If you have back taxes owing to the IRS, call a competent professional to find out what options are available to remove or prevent a Federal Tax Lien.