Tax Liens

As tax problems go, one of the worst things the IRS can do is attach tax liens to your property. They can always garnish your wages and levy your bank accounts, but tax liens are a particularly paralyzing weapon in the IRS arsenal.

Many taxpayers with lingering issues don’t realize just how much trouble they are in until it is too late. They see notice after notice come through with ever-increasing amounts of money owed and escalated warnings. The problem is that reading an IRS notice is about as easy to the average taxpayer as reading tea leaves.

Final IRS Notices

If you receive a Final Notice of Intent to Levy and Notice of Your Right to a Hearing (CP 90) or a Final Notice before Levy on Social Security Benefits (CP 91), the IRS is about to take your money.

While this is a 30-day notice, you do not have 30 days to act. If you receive one of these final IRS notices, you need to call us immediately. Even if you call today and we get everything in place in the next week, it’s a possibility that the IRS systems will not update quickly enough to stop the tax liens, levies, and garnishments that are scheduled to take place 30 days from the day the final IRS notice was sent.

If you are receiving any IRS collection notices, do not wait to take action, the longer you wait the more expensive the solution becomes. If you do have a Final Notice of Intent it is not too late, but you must act today to preserve your rights. Act immediately and call TaxMasters now!

Consequences of Tax Liens

Tax liens carry many consequences, short-term and long-term. As soon as the IRS files a tax lien, all property registered in your name is flagged. You generally cannot refinance or sell a piece of property, even to pay off your tax debt, without going through lien subordination or coming to some sort of agreement with the IRS beforehand.

In addition to freezing your ability to sell property, a tax lien puts a big red flag on your credit report. Most finance companies will not lend to you if you have a tax lien. And those that will lend to you in this circumstance typically charge almost inconceivable amounts of interest.

The long-term effects of the IRS filing a tax lien tend not to be discussed much, but they are very real. First, there’s the cost it will take you to get back into compliance with the IRS. Cost of services at any reputable IRS tax relief firm goes up as soon as you have a tax lien in place. The reason is that it takes a great deal more work to bring a taxpayer back from the bottom of the IRS tax lien cliff than to stop them from falling off in the first place. While you are working to regain compliance, the tax debt grows because of penalties and interest. So you wind up spending your resources and time on efforts to regain compliance instead of actually paying off the debt. Even after you have regained compliance fully and have paid your tax debt in full, settled that debt, or worked out a payment plan with the IRS, your credit remains in shambles. In many ways a tax lien does more damage to your credit long-term than does bankruptcy. So everything you finance over the decade following the enforcement of a tax lien costs more due to high interest rates.

All the additional costs that come with tax liens amount to an increased tax on the non-compliant. The current IRS and financial systems are designed not only to punish you for your tax lien now, but to continue to punish you for at least the next ten years.

Avoiding Tax Liens

Avoiding tax liens should be your highest priority if you currently have a tax problem. The way to do that is to call us today and get started right away on fixing your tax problem before it leads to a tax lien. Do not wait until you receive a final IRS notice. We can still help you even if you already have a tax lien, but the odds of stopping the IRS from filing a tax lien plummets exponentially with each day you wait to call.

Contact us or call us today at (866) 694-4018.

Until you need us,

Patrick Cox TaxMasters