What can the IRS put a lien on?

All assets including cars, home and other real estate, stock, bonds, and more. Having a lien on your assets makes it hard for you to use your assets as you please. For example, if you a lien is placed on your real estate, you will not be able to freely refinance the loan you have on the property until you receive a tax lien subordination or if you are able to discharge or have the lien withdrawn.

Does a Tax Lien affect My Credit Score?

As of April 2018, all three tax bureaus (Equifax, TransUnion, Experian) removed tax liens from appearing on your credit report meaning that a tax lien should not affect your credit score whether or not it has been paid off. Although a tax lien does not appear on your credit score it still does need to be handled as they are still public records and may appear on other consumer reports.

What is Trust Fund Penalty?

A Trust Fund in terms of employment tax should not be mistaken with a trust fund in terms of wealth management. This is the payroll tax amount assessed to the officers of the business. Tax resolution can help reduce and or arrange the payment of these taxes.

What is a Trust Fund Recovery Penalty (TRFP)?

A Trust Fund Recovery Penalty can be assessed if the unpaid trust fund taxes cannot be immediately collected from the business. This often happens if the business falls on hard times and taps into that fund for any reason. According International Revenue Code 6672(a) an individual can be held liable for penalty for willful failure to collect, account for, or pay to the IRS the taxes for the business.

Who is Held Responsible for the TRFP?

According to the IRS, the TRFP can be assessed against any person who is: responsible for collecting or paying withheld employment taxes, willfully fails to collect or pay the taxes.

Federal Tax Lien

What is a Federal Tax Lien?

A Federal Tax Lien affects your financial assets, personal property and your real estate property. Tax liens can vary based upon your individual situation. Furthermore, they are the government’s way of protecting their interest in case you fail to pay your tax debt in a timely manner. Moreover, if you fail to pay the IRS timely, a lien will be attached to all of your current or future assets until the offending tax issue is resolved. Finally, if you do not address the tax debt in a timely manner, the lien may develop into a levy where the IRS has the ability to seize said assets, including bank accounts.

What Are Assets?

Real estate property

Vehicle

(car, boat, motorcycle, etc.)

Bonds

Stocks

Cash

Bitcoin

Does a Federal Tax Lien Affect My Credit Score?

Since April 2018, all three tax bureaus (Equifax, TransUnion, and Experian) stopped reporting liens on credit reports. Consequently, this means that Federal Tax Liens should not affect your credit score regardless of whether or not the lien has been satisfied. However, even if a lien does not appear on your credit report, it still needs to be resolved since it is public record and can appear on other consumer reports.

How Do I Know If I Have a Federal Tax Lien?

The IRS has a filing process before sending out a notice. Therefore, they will:

If you do not pay the tax bill sent by the IRS, then the IRS will send out a lien notice.

How to Avoid a Federal Tax Lien

The best option is to pay the entire tax debt in full. However, if you are having trouble paying the full amount of your tax debt due to financial stress, the IRS offers a multitude of payment options in order to avoid a lien.

Some options are:

Although it may seem like a federal tax lien may be looming, there is always an available option that may help you avoid the Federal Tax Lien altogether. Visit our IRS problem resolution page for more of our services.

I Have Received a Federal Tax Lien Notice, What Do I Do?

First, do not panic! Although this may be your first reaction to receiving a Tax Lien notice from the IRS, it is possible to find a less painful resolution to your tax problem. Secondly, you can pay the entire amount owed to the IRS in full. However, if that is not possible, then there are several other options. Lastly, acting upon or applying for any of the following will help:

To learn more about liens, check the following :

Next Steps:

In conclusion: whether you believe you may receive a notice from the IRS or you have already received a notice from them, it is extremely important not to ignore it. Consequently, this will only make a bad situation worse. Moreover, you still have several options available depending on your and/or your business’ circumstances. Call us today to discuss your options and the best way to move forward for your specific situation.