By Greenberg law group, p.a.

What is a Federal  Tax Lien?

Understanding  Tax Liens

Keep swiping to learn more about federal tax liens.

A federal tax lien is a tool employed by the IRS, a body that represents the government, to secure tax debts.

It involves filing a legal document notifying the public and creditors that an individual owes unpaid taxes and that the government has a legal claim against the taxpayer’s property, including financial assets.

Tax Lien vs. Tax Levy

The terms “tax lien” and “levy” are often confused, but they refer to distinct actions taken by the IRS regarding unpaid taxes. 

A tax lien establishes the government’s legal claim against a taxpayer’s property, while a levy is the actual tangible action of seizing assets.

What Triggers a Notice?

The IRS may file a Notice of Federal Tax Lien when a taxpayer fails to settle their outstanding tax liabilities after receiving notifications for payment.

The IRS typically reviews the amount owed, puts it in the books, and sends a notice asking for the payment. If individuals don’t respond and act upon the request, the IRS can file a notice of federal tax lien.

How to Respond to a Federal Tax Lien

Carefully review the notice to verify the accuracy of the information provided, including the amount owed, tax periods involved, and other relevant details. Consider consulting a tax attorney to navigate legal implications and come up with an action plan. Finally, respond in a timely matter.

Options for Resolution

1. Payment Plan (Installment Agreement)

2. Offer in Compromise

3. Disputing the Lien

4. Withdrawal or Subordination

Need Help Navigating  Federal Tax Liens?

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