If the Internal Revenue Service contacted you about a Federal Tax Lien, your Norfolk property could be in jeopardy. The Internal Revenue Service threatens overdue taxpayers with these powerful Liens. Whether you feel helpless, frustrated or irate, your next moves could change your and your family’s future. Continue reading to learn about the components and dangers of Federal Tax Liens and how a Norfolk Tax Law Attorney can help you.
After the Internal Revenue Service attaches a Federal Tax Lien to your property, you will receive written notice of:
- The property address against which the Federal Tax Lien is filed;
- The Lien amount;
- The county in which the Lien is recorded; and
- Contact information for the Internal Revenue Service.
What You Should Know
After filing your Federal Tax Lien, the Internal Revenue Service waits ever so patiently for you to sell your property. Whether it takes months or years, they will be poised to swoop in at closing and take the full Lien amount from your proceeds, before you (and your mortgage company, if any) can take anything. They also take from you your right to determine how you spend your sale proceeds.
Perils to Consider
The risks of Federal Tax Liens are a mystery to most Virginians. Consider your:
- Career Choices: If you seek a higher salary position to pay-down your Federal Tax Lien, beware of positions requiring you to relocate. Should you sell your home, before you can apply your profits to a down payment on your next home, the Internal Revenue Service will apply those profits toward your Lien. Even moving expenses or an apartment deposit could prove beyond your reach. Your Federal Tax Lien can limit your career choices.
- Golden Years: If you dream of a comfortable retirement, partially funded by downsizing your current home and living on your equity, remember the Internal Revenue Service does not share your dream. They have first rights to your equity at closing to clear your Lien. You may need to work longer or live less comfortably. Your Federal Tax Lien can change your golden years.
- Home’s Worth: If your home’s value has declined lately, selling it may not be enough to clear your Federal Tax Lien. Your may not yield enough profit to pay-off your Lien and your mortgage, if any. How then will you fund your down payment on your next home? Your Federal Tax Lien can turn your biggest asset—your home—into your biggest nightmare.
- Credit Worthiness: If you work diligently to improve your credit score, you may see it worsen when news of your Federal Tax Lien reaches Experian, Equifax and TransUnion. Get ready for several possibilities: more expensive credit and possibly even the withdrawal of offers of credit, insurance and employment. Your Federal Tax Lien can impact every area of your life.
How Do I Clear This Federal Tax Lien?
Your best first step is to contact a Norfolk Tax Law Attorney. If you want to attempt clearing the Lien yourself, consider:
- Your Past Performance: Since you could not prevent the Lien from being filed, how can you expect to remove it yourself?
- Your Insider Knowledge: The Internal Revenue Service routinely credits partial payments as “payment in full” on Federal Tax Liens, if such an arrangement has been agreed to in advance. However, they frequently do not share information like this with taxpayers, as they want the highest collections possible. What else do you not know that may hurt you?
- Your Proficiency: How conversant are you in Internal Revenue Service regulations and procedures? How many Federal Tax Liens have you personally cleared?
The Internal Revenue Service looks after its own interests: collecting as much money as possible. Who will safeguard your interests?
Even past skirmishes with antagonistic creditors or belligerent litigants may not prepare you to contest a Federal Tax Lien. Taking on the Internal Revenue Service means taking on the United States Federal Government. Doing it alone is naïve at best, treacherous at worst.
Start today making better decisions. Contact a Norfolk Tax Law attorney. Find someone to help safeguard your interests.