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Some information about tax liens

If a Georgia taxpayer fails or neglects to pay a tax debt, the IRS may place a federal tax lien on the taxpayer's property. For the lien to be put into effect, the IRS must first assess a tax liability and make a demand for payment from the taxpayer. If the payment is not made in a timely manner, the IRS will file a Notice of Federal Tax Lien, putting the taxpayer's creditors on constructive notice.

The easiest way to get rid of the lien is to pay the balance that the IRS says is owed. In most cases, a lien is rescinded 30 days after an outstanding tax balance has been paid in full. In some cases, the IRS takes action to reduce the impact of the lien through subordination or withdrawal under certain conditions.

To qualify for a withdrawal of a lien without paying the full balance owed, the taxpayer must be current in all other tax obligations for the past three years. Additionally, the balance owed must be less than $25,000 if an installment plan has been agreed to. Those who owe more than $25,000 may pay down their outstanding balance to $25,000 and pay off the rest in installments.

The IRS has many tools that it may use to ensure compliance with tax laws. However, a tax assessment does not mean that the taxpayer actually owes the money. Instead, the taxpayer has a right to fight the assessment with the help of an attorney. A tax attorney may be able to negotiate a lower payment amount or convince the government that no taxes are owed. Doing so may result in the removal of a tax lien.

Source: IRS, "Understanding a Federal Tax Lien", October 07, 2014

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