Avoiding and Removing Tax Liens
Notice of Federal Tax Lien
A Notice of Federal Tax Lien may be filed only after the IRS accesses a tax liability, sends the Taxpayer a Notice and Demand for Payment and the Taxpayer fails to fully pay the debt within 10 days after the Notice and Demand for Payment is made.
Once these requirements are met, a lien is created for the amount of the Taxpayers debt. The Notices of Lien are generally filed at the courthouse in the county in which the Taxpayer resides or owns real property. The Notice of Lien therefore become a matter of public record and all parties and creditors are notified that the IRS has a claim against all of the Taxpayer's property. The filing of a Notice of Lien generally has a negative impact on the Taxpayer's credit rating thereby making it important to avoid the filing of a Notice of Lien if possible.
Notice of Federal Tax Lien
The IRS is required to notify the Taxpayer in writing not more than 5 business days after the filing of a lien. This notice is generally sent by certified or registered mail to your last known address. The 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 notice. The appeal must be filed the date shown on the notice. Issues that may be raised on Appeal include:
1. The Taxpayer paid the tax before the lien was filed.
2. The lien was filed when the Taxpayer was in Bankruptcy, and was therefore subject to the automatic stay.
3. The IRS made a procedural error in the assessment of the tax.
4. The time to collect the tax or the Statute of Limitations expired before the IRS filed the lien.
5. The Taxpayer did not have an opportunity to dispute the assessed liability.
6. The Taxpayer desires to propose other collection options.
7. The Taxpayer wants to assert Injured Spouse or Innocent Spouse defenses.
The IRS Office of Appeals will ultimately issue a decision that will support the continued existence of the filed federal tax lien or will determine that the lien should be released or withdrawn. If the Taxpayer disagrees with Office of Appeal's decision, the Taxpayer has 30-days after the date of decision to request judicial review in a court of proper jurisdiction.
Withdrawing Federal Tax Liens
A filed Notice of Tax Lien can be withdrawn if it was filed too soon or not in accordance with established IRS procedures, the Taxpayer entered into an Installment Agreement to pay the debt on the Notice of Lien (unless the agreement provides otherwise), Withdrawal would accelerate the collecting or satisfaction of the tax, or Withdrawal would be in the Taxpayer's best interest (as determined by the Taxpayer Advocate), and in the best interest of the government.
Releasing 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 or within 30 days after the IRS accepts a bond that the Taxpayer submits, guaranteeing payment of the debt.
Applying For A Discharge Of A Federal Tax Lien
If a Taxpayer is selling property subject to a Tax Lien, the Taxpayer may apply for a Certificate of Discharge. Each application for a discharge of a tax lien releases the lien against a particular piece of property. A third party other than the Taxpayer may also request a Certificate of Discharge.
Get A Game Plan!
Tax Liens can, in many instances, be avoided through careful planning. It is important to have a well devised plan for discharging tax indebtedness and almost impossible to achieve without the help of an experienced professional who understands the process or various processes that may be involved, what is possible and what is not, and the full range of remedies available. As an attorney certified as a tax specialist, John Kachmarsky and the staff at the Law Office of John Kachmarsky have that experience and knowledge
Contact our Charleston, South Carolina law office today to make an appointment for an initial telephone consultation.
