How To Avoid A Property Tax Lien
Are you familiar with property tax liens? If you have heard of this, then you know there is a reason why the Internal Revenue Service (IRS) des what they need to do. Basically, those who fail to pay taxes are hit with a property tax lien.
The government can place a lien on any property such as a house, land, car, bank account, and sometimes on a business. This is the IRS making the legal action to seize properties to satisfy the tax debt owed.
Stop A Full Take Over
Once a lien is placed on a property, it almost automatically happens that the rest of what you own will be claimed by IRS if the tax remains unpaid. There is one obvious way to prevent all this and that is to pay the debt. It is an obligation we can not avoid and this isn’t the kind of debt one can easily run away from.
With a lien placed on your properties and when the government starts selling your possessions, this will gravely affect your credit score. A low credit score will give you a hard time borrowing money from any lender when you need it. Most credit scores according to Credit.com, ranges in between 300 to 850. Getting a score way below 600 can spell credit disaster.
Also, when the IRS goes full force in satisfying the debt, this will become a public record, one that sticks to your name like glue for 10 years. In addition, you will have to pay fines and more in interest for the property to be released.
It’s Not Just The Current Property
While there is a lien, any new real estate purchased will be included in the claim. Everything is tied up together, and unless the debt and interest are fully paid, there is not much that can be done to keep your possessions out of the government’s hands. So if your wife or husband plans to buy a new house to escape this horror, don’t do it just yet.
Cashflow can be slow sometimes, and this often results in financial complications. If paying the tax debt in full can not be done right away, proactively negotiate with IRS. As strict as they may seem when in comes to collecting what is owed, they are more accommodating to agree on a settlement compared to private lenders.
Work with them to find a way to release the lien even if you can’t pay in full right away. Here’s a few circumstances where IRS may issue a Withdraw or Release filing of the Notice of Federal Tax Lien:
- The taxpayer pays a lower amount of tax by method of an Offer in Compromise.
- File a Certificate of Discharge in the event that the house or property is sold.
- There was an error on the procedure during the assessment.
- The taxpayer was not given an appropriate opportunity to dispute the claim.
Read more about the other conditions of release here.
Save Your Effort And Time
If all this seems like a long stretch of constant legal battle to keep your property and you find it too much to handle with so little time in your hands, might as well talk to one of our real estate experts. RealSprout is a real estate investment company ready to extend a hand to those who badly need to get away from a problematic house.
We buy houses San Antonio, Texas from anyone who wants to sell, irregardless of the reason for selling. If it is about low equity or property liens, about job loss and financial instability, or you simply want to move away for good; then we are the best company to work with.
In San Antonio, we buy houses using simple but fast methods, often completing a sale in 5 days. Are you up for fast action and quick response? Then talk to us when you need to sell right away!