What Does It Take To Get A Lien Release?
The purpose of this page is for you to understand what a lien is and what steps can be taken to get an IRS lien release. A federal lien is one of the first steps IRS will take when monies are due to them, enough time has elapsed and your debt to the IRS has not been addressed. A notice of federal tax lien enables the IRS to become a secured creditor and gives them legal right to your assets. And whether you have assets or not, an IRS tax lien also greatly affects your credit rating, making it difficult to obtain a loan (such as a mortgage or car loan) from banks or other lenders, get a credit card or obtain credit in any fashion. And if you do receive a loan or credit, it probably will be at a much higher interest rate, costing you a lot more money overall.
Also note that once a federal lien is filed, it becomes public record and now-a-days, bad credit ratings may even affect you ability to get the job you want as employers are looking at your credit ratings as well. If you owe a home and want to sell or refinance it and have a lien, you may have to pay off their claim on this asset to get the lien discharged. Also understand that once an IRS lien has been imposed upon you, only under special circumstances, will it be removed or the tax liability has been resolved and/or paid. If you have an IRS lien, there are basically three ways to resolve and get the lien release you seek.
1. Pay off the liability in full, of which then they will gladly remove the lien.
2. Get on a payment plan but note that the lien will not come off until the balance is paid in full.
3. See if you qualify for one of the IRS programs to reduce your liability, get that relief and then pay off the balance for the lien to be removed.
One of the biggest mistakes made by most taxpayers is not knowing the difference between an IRS lien and an IRS levy. Liens do not take anything from you except points off of your credit ratings which may have a long term effect but some taxpayers don’t feel it immediately therefore they don’t do anything about it right away. Levies are a seizure of your assets like bank accounts, 401ks, SEPs and believe or not, Social Security benefits (as well as other assets) and wage garnishments of which the IRS will take a certain percentage of your take home pay which you will feel right away. This is usually the second step IRS will take once a lien has been imposed but still that tax liability hasn’t been addressed by you, the taxpayer. In our experience, we find most people still do not address their tax debt until a levy forces them into action. It is our advice not to wait till this happens and to become proactive right away to address the lien before it becomes a levy. And do not be fooled into thinking that in time, you couldn’t have an IRS tax Lien and an IRS tax levy at the same time because in time you could have both if that tax debt is not taken care of in a timely manner.
You should at options at getting you back on track by addressing that lien and help you work towards a resolution that not only will get you a lien release but also stop any other IRS collection method that will be headed your way. Please know this, a lien is just the first step and other methods to collect what is owed to them are on your horizon if you leave this alone any longer. So, working with experienced ex IRS agents would help you a lot.