subject: Under What Conditions Can The IRS File a Property Lien? [print this page] Under What Conditions Can The IRS File a Property Lien?
With our economy in bad shape, the government desperately needs to generate more revenue. There is a huge budget gap and the IRS is looking to fill that hole with more tax dollars. The amount of IRS audits is going up and this would naturally means that the amount of people that have outstanding taxes will also rise.
So, with more people in trouble with the "tax man", it is important that we understand the rules of what the IRS is allowed to do to us. The whole process of an IRS lien takes place pretty rapidly. Once they send you a "Notice and Demand for Payment" letter, you have 10 days to repay the entire amount that is due. (Not that there isn't room for negotiation.)The rest of the process is pretty simple. If you fail to pay the amount due in 10 days, then the IRS automatically has a lien on your property. They do not need to file any more paperwork, and they also automatically get first dibs on your property before all other creditors. In order to have the lien removed they must be paid in full or a partial payment that was agreed to with an IRS agent.
Getting IRS letters can be pretty frightening. A friend of mine recently got 5 letters of outstanding payment in 1 year. All of them turned out to be a mistake, but he still had to pay an accountant to resolve the problems. If you want to save money, it can also be taken care of on your own, but it can be pretty helpful to have someone who really understands the tax law, to speak on your behalf.
IRS liens last for 10 years (they can also re-file when this time is up), so it's not as if they are just going to disappear. If your receive an IRS letter about outstanding debt, you should contact a professional CPA that is qualified to fully understand the problem and can negotiate on your behalf. But if you are having money issues, it is possible to educate yourself and handle it on your own.
