Facing an IRS tax lien is a heavy burden that can feel like a constant threat to your financial security. We understand the stress and uncertainty that comes with government claims on your home, business, and savings.
You are not alone in this process, and there are legal pathways available to protect your property and restore your financial future. Navigating federal tax law is complex, but understanding your rights is the first step toward a resolution.
Whether you are trying to sell a home, refinance a mortgage, or simply stop the IRS from seizing your assets, professional legal representation can make the difference between financial loss and a fresh start.
A federal tax lien is the government’s legal claim against your property. This claim is broad and encompasses everything you own, including real estate, personal vehicles, and business equipment.
It also attaches to any assets you acquire while the lien is in effect. Because this claim is a matter of public record, it signals to creditors that the government has a priority right to your equity.
An unresolved lien creates significant barriers to your economic freedom, often resulting in:
The process begins with a tax assessment. Once the IRS determines a liability exists and sends a bill that remains unpaid, a statutory lien is created.
However, it only becomes a public obstacle when the IRS files a Notice of Federal Tax Lien. This filing is what notifies the public and financial institutions that the IRS has a secured interest in your property.
Before filing a public Notice of Federal Tax Lien (NFTL), the IRS sends a Notice and Demand for Payment (such as CP14, CP501, or CP503), explaining the amount owed and demanding payment within 10 days.
If unpaid, the lien arises automatically, and the NFTL may be filed to alert creditors. Separate from liens, the IRS may send additional warnings before escalating to levies (asset seizures), including:
Ignoring demand notices (like CP501 series) can lead to quick NFTL filing. Separately, failing to respond to a Final Notice of Intent to Levy (LT11) forfeits your CDP hearing rights for levies, limiting administrative resolution options for enforced collections.
Receiving notice of a lien requires a fast and focused response. You must determine the exact status of your IRS file to understand which deadlines are active.
Taking the right steps now may help prevent or limit enforced collection actions, including bank levies or wage garnishments.
If a tax debt was caused by a current or former spouse without your knowledge, you may qualify for Innocent Spouse Relief. If granted, this prevents a lien from attaching to your individual assets for a debt you did not cause.
It is vital to understand that “Discharge,” “Release,” and “Withdrawal” are different legal remedies. Using the wrong term when dealing with the IRS can lead to delays in your property sale or refinancing.
These remedies apply to different financial objectives, whether you are seeking to liquidate a single asset or clear your entire public record.
If unresolved, a federal tax lien can affect multiple areas of your financial and operational stability. These consequences typically escalate as the IRS advances its collection efforts.
Area Affected | Practical Consequence |
Credit and Financing | Denied or restricted access to credit due to the government’s priority interest. |
Real Estate and Property | Inability to sell or refinance property without resolving the IRS lien or obtaining a discharge or subordination. |
Business Operations | Operational constraints, including limited access to business credit and potential interference with contract eligibility. |
Enforcement Risk | Increased exposure to enforced collection actions, including bank levies and wage garnishments. |
When you own real estate, a lien acts as a cloud on the title. Buyers will not purchase the property, and lenders will not provide financing, until that cloud is removed.
Requesting a discharge is a technical process where you must prove that the government’s interest is protected.
To sell property with an active lien, you must apply for a Certificate of Discharge. The IRS will typically grant this if the sale proceeds are sufficient to pay off the tax debt or if the IRS receives the net equity from the sale after superior mortgages are paid.
Providing a clear title is a requirement for any real estate closing. By securing a discharge, you ensure the buyer’s interest is superior to the government’s.
This process requires precise coordination between your attorney, the title company, and the IRS collection officer.
Situation | IRS Requirement |
Property Sale | Application for Certificate of Discharge |
Refinancing | Proof of IRS interest protection (Subordination) |
Partial Equity | Allocation of proceeds to the IRS |
The IRS can release a federal tax lien in several ways, depending on payment status or specific agreement terms.
Approved Payment Agreements: The IRS may withdraw the lien under certain installment plans (e.g., direct debit), while release typically occurs after full payment.
Since 2018, the major credit bureaus no longer report tax liens on consumer credit reports. However, the lien remains a public record in courthouse files until resolved.
Lenders or employers who check public records directly may still see it. Only a withdrawal removes the Notice of Federal Tax Lien from public records as if it never existed.
Even if the filing is removed from consumer credit scores, specialized background check companies often report this as a sign of past financial instability. To truly clear your name, you often need a withdrawal, which effectively deletes the record of the filing.
A released lien still shows that a lien once existed. To fully protect your reputation, we assist with filing the Certificate of Release with the appropriate county recorder, updating county records to reflect the resolution, and correcting errors in third-party databases and data aggregators.
Our firm utilizes a proactive strategy that prioritizes procedural precision and the protection of your assets.
By leveraging a deep understanding of the Internal Revenue Manual and established IRS collection procedures, we intervene early to resolve lien issues and ensure property transaction timelines remain intact.
Our legal strategy includes:
Internal Revenue Manual compliance oversight: Ensuring every filing and appeal adheres strictly to federal procedural requirements to prevent unnecessary delays.
McCauley Law Offices provides focused representation in high-stakes IRS tax controversy matters. We operate at the critical intersection of federal tax law and complex real estate and title issues, ensuring that our clients’ properties and financial reputations are handled with the highest degree of technical expertise.
Our legal team guides you through:
We provide guidance at every stage of the process to help clients understand their options and protect their rights and property.
Contact McCauley Law Offices to arrange a risk-free consultation and discuss your case.
Question | Answer |
Can the IRS place a lien even if I am on a payment plan? | Yes, unless you qualify for a specific “Streamlined” agreement, the IRS may still file a lien to secure its interest. |
Can I sell my house if there is a federal tax lien? | Yes, by applying for a Certificate of Discharge. This allows the sale to proceed while the IRS collects its portion from the equity. |
How long does it take to remove a tax lien? | A release takes about 30 days after payment. Negotiating a discharge or withdrawal can take several weeks or months. |
Will paying my taxes automatically remove the lien? | Full payment triggers a release within 30 days, but you must verify the IRS has filed the necessary paperwork with the county. |
Will a released lien still affect my credit? | It can still appear in public record searches. A withdrawal is the only way to treat the lien as if it never existed. |
