Lien and Levy Removal
Liens and levies are two different collection alternatives that the IRS uses, and they are very different. A lien is a simply a notification to the public (via a filing with the county clerk’s office) that you owe money to the IRS. Without more, a lien does not do anything to take money from you. The difficulty with liens arises when you try to enter into other financial transactions. For example, if you try and sell your home, the IRS lien will show up on the title report and will have to be resolved prior to sale.
This can often result in the IRS stepping in and using whatever proceeds you were going to receive from the sale to pay your back taxes.
Even more problematic is the fact that the IRS lien is a matter of public record and will often have a negative affect on your creditworthiness. This can result in you being charged higher interest rates, or even being denied credit altogether. We have seen the filing of a tax lien result in as much as an 80-100 point drop in an individual’s credit score. Since the IRS considers your back-tax liabilities to be “unsecured”, an IRS lien can be difficult to have removed.
A levy is how the IRS attempts to take money from you without your permission. Levies are sometimes issued against your bank accounts, or your employer. If you are a business, the IRS can send levy notices to your customers. This results in your customers paying what they owe you directly to the IRS, instead of you! Levies are a very heavy-handed method of collection and are often the method of last resort used by the IRS.
Lien and Levy issues are extremely time sensitive! Contact us as soon as you receive anything from the IRS with wording such as “Notice of Intent to Lien” or “Notice of Intent to Levy”. Response times can often be as short as 10-20 days. Missing these deadlines can make resolving these issues much more difficult.
We have extensive experience in working with the IRS to resolve lien and levy issues. Let us navigate the labyrinth of IRS rules and regulations to get you the relief that you are entitled to.
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