Business Taxes: Lien

Lien: Contents

What is a Lien?

A lien is a legal claim against your property (real estate, personal property, financial assets, etc.) to satisfy a debt.  If the underlying debt is not satisfied (paid), the creditor may be able to seize the asset that is the subject of the lien and sell it to satisfy the underlying debt.  While a lien is in place on your property, you cannot sell the property without the consent of the holder of the lien.  There are various types of liens, including bank liens (on collateral), real estate liens (like your mortgage), and tax liens.

What is an IRS Lien?

A federal tax lien is the government’s legal claim against your property when you do not pay a tax debt on time. The lien protects the government’s interest in all your property, including real estate, personal property and financial assets. A federal tax lien exists after the IRS assesses your liability, sends you a Notice and Demand for Payment, and you do not pay the amount owed in time.  The IRS files a public document, called a Notice of Federal Tax Lien in the county clerk’s office that alerts creditors that the government has a legal right to your property.  Liens can make it very difficult for you to secure credit and borrow money, get approved for loans, sell your property, and rebuild your credit score.  Our team of tax professionals can determine if any tax liens have been filed and negotiate the removal of these tax liens in conjunction with negotiating your other tax relief options.

What is a State Lien?

Similar to a federal tax lien, a state tax lien is the state government’s legal claim against your property when you do not pay a state tax debt on time. The lien protects the state government’s interest in your property, including real estate, personal property and financial assets.  As with a federal tax lien, a state tax lien can make it very difficult for you to secure credit and borrow money, get approved for loans, sell your property, and rebuild your credit score.  Our team of tax professionals can determine if any tax liens have been filed and negotiate the removal of these tax liens in conjunction with negotiating your other tax relief options.

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