Metro Area: Hartford-West Hartford-East Hartford, CT MSA
What Is an IRS Tax Lien?
An IRS Tax Lien is an enforcement method of the IRS for back and unpaid tax collection. This is the first major step the IRS takes against taxpayers who have unpaid back taxes. With the help of IRS tax liens, the IRS places a legal claim on your property as security for your tax debt. This is a way through which the interest of the government in your assets is protected by the IRS.
When and Why is a Tax Lien Filed?
If you are a taxpayer from Hartford, West Hartford, or East Hartford area, who has unpaid back taxes and who has no intention of cooperation with the notices from the IRS to pay your back taxes, you will receive tax liens. Later, a the IRS turns to a tax levy on your bank account and your wages.
Here is how the process works.
You'll get a letter from the IRS which will include an assessment of your tax liability. The letter will include the total unpaid tax dues plus late payment penalty and interest. If the taxpayer ignores this assessment letter, the IRS will follow up the case with four more letters, CP-501, CP-502, CP-503, and CP-504.
These letters from the IRS will threaten you more with higher tax due amounts. The final letter will mention to you IRS’ intent to levy and or to file a tax lien. If the IRS does not get any timely response from the taxpayer, they will decide that the conventional ways will not help in collection of the tax due.
In that case, the IRS will file a Notice of Federal Tax Lien (NFTL). You will get a notification of the tax lien. The lien is attached to your property.
The main objective of IRS tax lien is to prevent you from selling your property or assets or borrowing against them. The IRS tax lien helps the IRS to place a legal claim on the taxpayer's assets. IRS tax liens are public records.
Effects of a Tax Lien
When an IRS tax lien is placed on your property, you cannot get any credit to make any additional purchase such as a house, a car etc. It can cripple you financially. All your creditors are notified about your tax lien. That includes your mortgage company.
An IRS tax lien may stay in place for 10 years or as long as the IRS can legally enforce action against you. It can be released if you pay your tax liabilities completely.
If you do nothing, the IRS will eventually seize your properties and assets and sell them at a public or private sale. An experienced tax relief professional such as IRS licensed enrolled agent can help you to come out of this messy situation.
Get expert tax help today by calling Mike Habib, EA at 1-877-788-2937