In cases when an individual owes money to the IRS, the IRS will often place a federal tax lien on their property. This protects the government’s interest in their property such as real estate or financial assets. If you have unresolved tax debt, the IRS will not place a tax lien on your property before attempting to contact you. This will only happen after they have sent you a bill for your tax debt and the bill has not been paid in full on time. It can be possible to avoid tax liens by asking for an installment agreement or other form of tax relief. However, if you have a tax lien on your property or financial assets, there are several ways that you can have this removed. At Solvent Tax Relief, we provide help with tax lien discharges.
What Is a Tax Lien Discharge?
A discharge of an IRS tax lien removes the lien from a certain piece of property. If you have several pieces of property that the IRS has placed a lien on, a discharge allows you to sell or refinance that property. If you do not have the lien discharged, if you sell your property, The IRS can still seize it even if it no longer belongs to you. When the IRS discharges a tax lien, the following will happen:
- You will receive a certificate of discharge
- You will still need to pay off your tax debt, whether through an installment agreement or in full
- Other properties may still be part of your tax lien
Some of the benefits of a tax lien discharge include the ability to refinance your home or to purchase a new one. Refinancing your home or selling a piece of property could help you pay off your tax debt.
Why Will the IRS Grant a Tax Lien Discharge?
Getting a tax lien discharged can be complicated. It’s best to consult a tax professional who can communicate with the IRS on your behalf, gather all necessary information, and file the correct forms. You need to show that there is a good reason for the IRS to discharge the tax lien. Some of the following might help you receive this status:
- You have other properties that are subject to a tax lien which are worth two times the amount as your liability
- You have paid the IRS the amount that is equal to their lien interest
- You are selling your property and the funds you receive will be put in escrow subject to the IRS
- There’s a third party who owns the property that is under the IRS tax lien
- The property is worthless
There are several other ways to remove a tax lien from your property other than an IRS tax lien discharge. For example, paying off your debt in full will release the lien. If you apply for a lien subordination, the tax lien will still be in place but another creditor can receive an interest in your property. This means you may be able to get a loan or a mortgage. A withdrawal removes the tax lien if you have entered into an installment agreement.
Bankruptcy will not remove a tax lien, although it might discharge tax debt that has caused the lien.
If you received notice that the IRS is placing a tax lien on your property, contact Solvent Tax Relief right away for tax relief services. The longer you wait, the more extreme measures the IRS can take.
Contact Solvent Tax Relief Today
The best way to avoid a lien is by paying all your taxes in full and on time and communicating promptly with the IRS if they have sent you a letter. While a lien does not mean that the IRS will actually take your property, it can still keep you from making decisions about what to do with your financial assets. At Solvent Tax Relief, we provide a variety of tax resolution services to help ease the burden of tax debt. Reach out to our team today at 800.985.9426 to learn more about tax lien discharges.