How To Get Rid Of A Federal IRS Tax Lien

How To Get Rid Of A Federal IRS Tax Lien


Federal and state tax liens and levies cause some of the most stressful and costly headaches for taxpayers in America. Understandably, citizens seeking tax debt relief are often confused and overwhelmed by the sheer amount of information and laws the IRS relies on to operate within the country’s massively dense tax code. If you’re facing a federal or state tax lien or levy, read on for information about some of your rights and options.


Understanding A Federal Tax Lien

First off, it’s helpful to understand exactly what tax debt scenario you’re facing. That may start with parsing the difference between a tax lien and a tax levy. The two are not the same; for most taxpayers, the levy is the one that really hurts them in the pocketbook. A levy is the actual taking or garnishment of wages or property to satisfy an unpaid tax debt. A lien, on the other hand, is filed as a notice of legal claim against property or wealth due to unpaid taxes.

Despite the more immediately painful nature of a levy, a lien can be stressful and difficult to deal with, too. A lien filing negatively affects your credit, and appears in public records. Particularly if you have large and valuable assets such as a home or multiple properties, the filing of a lien against these assets can be shocking and scary. The threat of feeling like the IRS or FTB is breathing down your neck in your own home that you and your family live in is an unbelievably anxiety-inducing prospect for taxpayers. So much so, in fact, that our firm often finds that many people’s initial instinct is — like an ostrich — to bury their head in the sand and hope the problem resolves itself.

Unfortunately, as we are all well aware at this point, the problem will not simply resolve itself. The IRS and FTB are some of the most aggressive (and legally enabled) creditors on the planet, and they will methodically and ruthlessly pursue debts they are owed by an astonishing variety of methods. There’s just no two ways about it: if you don’t take action to put your finances and debts in order (such as hiring a tax resolution attorney in Los Angeles), the government will continue aggressively seizing your assets.


Tax Lien Removal

When clients ask us about tax lien removals, they’re usually talking about one of two things: removing the actual lien from their assets, or removing the lien from their credit/financial history. For both of these items, there is both good and bad news. The bad news is that, if you’re a busy person, they might be tough to complete without the assistance of a licensed and qualified tax attorney. The good news is that, if you are willing to retain a tax attorney that has experience with tax debt negotiation, you have a plethora of options to have either scenario end favorably.

As far as removing the lien itself, don’t forget that the IRS offers programs to assist taxpayers in their back tax payments. Offer in compromise, payment plans, and other options exist for this exact purpose; and while a tax attorney can certainly make obtaining these things much easier, it’s worth a look on your own as well, if you’re feeling enterprising. Often, citizens will qualify for these programs, saving them untold thousands of dollars had they not attempted to fix the problem. Again, these two programs are prime examples of why simply ignoring your tax problems is the worst possible approach to take. If you make no good faith effort to work with the IRS, they will be happy to garnish you for the maximum amount they can.

The other question we hear a lot is: can tax liens be removed from credit reports? The answer is yes; if the lien was paid off and you made good on your tax debt, there is a way to get that pesky tax lien off of your credit report permanently. That’s not the only scenario where you can have a lien removed, but it might be the easiest one to accomplish by yourself. Let’s take a look at the steps involved in the most straightforward method of doing so:

  • Fill Out IRS Form 12277
      1. This form is used to begin your request to get rid of (“withdraw”) the old tax lien. If you still have your form 668(Y), you may be able to shave some time off of the process of completing form 12277. If you recall, form 668(Y) was that unfortunate original notice of your tax lien being administered.
      2. When you get to question number 11 on this form, select the following reponse: “The taxpayer, or the Taxpayer Advocate acting on behalf of the taxpayer, believes withdrawal is in the best interest of the taxpayer and the government”
  • Send In IRS Form 12277
      1. Using certified mail, send in your completed form 12277. You’ll want to send it to your regional IRS office, so make sure you use IRS Publication 4235 to obtain that information.
  • Wait 1-2 Months (Or Less) For A Response From The IRS
      1. The IRS will review your submitted documents; and, if appropriate, they’ll initiate communication with the court where the lien was originally filed. You will receive documentation of their communication with the court in the IRS’ next correspondence with you.
  • File A Dispute With Credit Reporting Agencies
      1. Now that the lien is withdrawn officially, it’s technically not accurate for credit reporting agencies to still list the lien as a negative mark against your credit. When you file the dispute, the reporting agencies will verify that the lien is gone, and hastily take that negative mark off of your report.
  • Verify That The Lien Was Removed
    1. Look at your credit report 2-4 weeks after this process and confirm that the lien was removed successfully. If you need to file a second dispute, do so — it’s well worth your time to deal with this unpleasantness once and for all, as a lien is a rather significant negative mark against your credit.


Tax Resolution Attorney Los Angeles

Let’s face it: tax liens and levies are not the most fun subjects in the world to think about or deal with… for you. But do you know who enjoys the process of lien removal and knows the law like the back of their hand? The attorneys at Abajian Law, staffed by a veteran team including a former IRS tax attorney. If you don’t want to deal with the process of removing a federal IRS lien, but you’re financially wise enough to know that this is something you should deal with as soon as possible, consider retaining the veteran tax attorneys at Abajian Law to take care of your tax lien situation on your behalf. With years of proven quality work saving Californians thousands of dollars and removing troublesome liens, Abajian Law can be a discreet and professional shortcut to financial peace of mind.

Call Abajian Law today for a totally obligation-free, confidential discussion about your tax debt situation to determine how we can help you take care of your IRS lien problems and move on quickly.

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