Federal Tax Liens
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Federal tax liens: unveiling the basics
Federal tax liens are legal claims against a taxpayer’s property, both real and personal, used as collateral to secure unpaid taxes owed. These liens are a result of a series of steps taken by the IRS to collect overdue taxes.
How federal tax liens happen
Federal tax liens typically follow these key steps
- Unpaid tax owed: The consequences begin with a taxpayer owing federal taxes. Whether it’s income tax, employment tax, or other types of federal obligations.If you owe the IRS over $10,000 a federal tax lien will be placed on your account.
- IRS assessment: The IRS assesses the unpaid tax amount by calculating the amount owed, which includes taxes, penalties, and interest.
- Notice and demand: The IRS sends a notice and demand for payment, officially alerting the taxpayer to the outstanding debt.
- Taxpayer’s neglect or refusal: If the taxpayer neglects or refuses to pay the debt within the specified timeframe (usually ten days), a federal tax lien is automatically established.
Implications of federal tax liens
Federal tax liens can have far-reaching consequences for individuals
- Seizing property: The most immediate effect is the seizing of the taxpayer’s property, including homes, vehicles, and other assets. This can make selling or refinancing property challenging. Any proceeds from the major asset such as sale of home will directly go towards paying your tax liability first before any distribution of net profit to the seller.
- Difficulty in selling/buying property: Selling/buying property with a federal tax lien can be complicated as it requires taxpayers to pay off the debt first.
How we can help
Dealing with federal tax liens can be overwhelming, but you don’t have to deal with this alone. LifeBack Tax Relief specializes in assisting individuals facing tax-related challenges, including federal tax liens.
Here’s how we can help;
- Negotiation and resolution: We can negotiate with the IRS on your behalf, and help you explore options that fit your debt situation. Such as an offer in compromise, installment agreements, or other resolutions to help you gain financial relief.
- Lien withdrawal: We have also worked with taxpayers and helped them in getting their federal tax lien withdrawn completely.
- Financial analysis: Our team conducts a thorough financial analysis and provides a FREE IRS transcript to determine the best course of action for your specific circumstances.
- Peace of mind: With LifeBack Tax Relief by your side, you can have peace of mind knowing that our professionals are working tirelessly to find a solution to your tax challenges.
Dealing with federal tax liens may seem daunting, but with the right support and guidance, you can navigate this process successfully. Contact LifeBack Tax Relief to explore your options and regain control of your financial future.
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