Pappas & Associates, P.A.

If you owe the IRS money and you don’t pay it in full, there is a high likelihood it will file a Notice of Federal Tax Lien against you.

An IRS lien destroys your credit.

Once the lien is filed it is extremely difficult to get the IRS to release it.

The best way to deal with a tax lien is to prevent it’s occurrence in the first place.

Here’s how.

1. Respond immediately to all IRS notices - even the apparently nice ones. By far the fastest way to get a tax lien put on you is to ignore IRS notices because the government assumes that you are delaying the collection process in order to hide or transfer your assets. They put a tax lien on you to secure their interests. See IRS Collection Notices: How Serious is Yours? for a description of the various collection notices and what they mean.
2. Treat IRS collection agents with respect - IRS agents are used to having taxpayers curse at them, accuse them of harassment, threaten to report them for misconduct. If you treat your collection agent respectfully, he or she will take notice and it may help you when it’s time to determine whether or not to place a lien on you.
3. Get current with all of your tax filings – You will have more credibility with an IRS agent if he or she sees that you are currently in compliance with the tax law. If you can show that your tax problem was an isolated incident that could go along way in preventing the IRS from filing a lien against you.
4. Don’t lie to an IRS agent - If you lie about your assets or make promises to the IRS you don’t keep, you will lose credibility and make the agent believe that you are intentionally delaying enforced collection. In order to protect the government’s interest in your assets, he or she will proceed to enforced collection actions, including the filing of a federal tax lien. And if you lie to an IRS agent in writing, you could be charged with a crime.
5. Pay a downpayment on what you owe - If you can get the amount you owe to the IRS under $25,000, you may be able to avoid a tax lien.
6. Borrow the money to pay the IRS in full – Easier said than done in these credit restrictive times, but worth exploring. It is preferable to owe a lending institution money than it is to owe the IRS and have a federal tax lien on your credit.
7. Consult with a tax lawyer or CPA – This one is obvious. If your tax debt is serious enough that the IRS is considering pursuing enforced collection, including, but not limited to the filing of a tax lien, you simply must talk to someone who has experience in these matters. The IRS knows it has a great advantage over taxpayers who are not represented by counsel and it likes to keep that way.