If you receive a notice of an IRS lien contact us to learn how we can develop a legal strategy for promptly responding to the IRS. By appealing a notice of lien we may be able to you negotiate an appropriate offer in compromise or installment agreement to preserve your assets and minimize your liabilities.

NOTICE OF FEDERAL TAX LIEN

The IRS may impose a federal tax in connection with any kind of federal tax, including but not limited to income tax, gift tax, or estate tax assessed by the IRS. Liens give the IRS a legal claim to the taxpayer's property as security or payment for the taxpayer's tax debt. The IRS may only file a Notice of Federal Tax Lien after:

• The IRS assesses a tax liability;

• The IRS sends a taxpayer a Notice and Demand for Payment; and

• The taxpayer neglects or refuses to pay the debt within 10 days after the IRS notify the taxpayer of the lien. A lien is created for the amount of the taxpayers tax debt.

By filing notice of the federal tax lien, the taxpayers creditors are publicly notified that the IRS has a claim against all the taxpayers property, including property the taxpayer acquires after the 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 federal tax lien attaches to all the taxpayers property and rights to property, such as accounts receivable.

RELEASING AN IRS LIEN

Upon full satisfaction of an assessment, the IRS will release a federal tax lien. The IRS will issue a Release of the Notice of Federal Tax Lien:

• Within 30 days after the taxpayer satisfies the tax due (including interest and other additions) by paying the debt, or

• Within 30 days after the IRS accepts a bond from the taxpayer submits which guarantees payment of the debt.

The taxpayer must pay all fees that a state or other jurisdiction charges to file and release the lien. Generally, a federal tax lien releases automatically if the IRS does not filed it again. If the IRS knowingly or negligently does not release a Notice of Federal Tax Lien when it should be released, a taxpayer may sue the federal government for damages.

PAYOFF AMOUNT

The full amount of the taxpayer's lien will remain a matter of public record until it is paid in full. At any time a taxpayer may request an updated lien payoff amount to show the remaining balance due.

APPLYING FOR A DISCHARGE OF A FEDERAL TAX LIEN

If a taxpayer is disposing of property, such as the sale of a personal residence, the taxpayer may apply for a Certificate of Discharge. Each application for a discharge of a tax lien releases the effects of the lien against one piece of property.

WITHDRAWING LIENS

• The IRS can withdraw a filed notice of tax lien if:

• The notice was not filed according to IRS procedures,

• The taxpayer entered into an installment agreement to pay the debt on the notice of lien,

• The IRS determines that withdrawal of the lien will speed the collection of the tax, or

• Withdrawal would be in the best interest of both the IRS and the taxpayer.

APPEALING THE FILING OF A LIEN

The law requires the IRS to notify a taxpayer in writing not more than 5 business days after the filing of a lien. The IRS may give a taxpayer this notice in person, leave it at the taxpayer's home or the taxpayer's usual place of business, or send it by certified or registered mail to the taxpayer's last known address. A taxpayer may ask an IRS manager to review the taxpayer's case, and a taxpayer may request a Collection Due Process hearing with the Office of Appeals by filing a request for a hearing with the office listed on the taxpayer's notice.

CONTACT US

To speak to a Houston tax attorney about your responding to an IRS notice of lien, please contact us here or call us at 713.650.9700.

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