For many taxpayers, the reality of a Notice of Federal Tax Lien (NFTL) hits not when they receive a letter, but when a mortgage application is denied, a business line of credit is frozen, or a title company refuses to close a real estate sale.
A federal tax lien is more than a public notice; it is a comprehensive legal claim that encumbers every asset you own. It signals to competitors, lenders, and the public that the government has priority over your financial life. Once filed, it acts as a “cloud on title,” paralyzing your ability to refinance, sell property, or secure essential business funding.
Navigating the removal or subordination of a lien requires a specialized federal tax lien attorney. Ignored liens do not vanish; they restrict your financial freedom until the debt is satisfied or the statutory collection period expires. Immediate legal intervention is necessary to challenge the filing, negotiate a withdrawal, or structure a resolution that clears your title.
A federal tax lien is the IRS’s legal claim on your property when you have unpaid taxes. It is created automatically under IRC § 6321 after the IRS assesses the debt, sends you a bill (Notice and Demand), and you don’t pay. Even if it’s not publicly filed, the lien gives the government a legal right to your assets.
When the IRS files a public Notice of Federal Tax Lien (NFTL), it alerts other creditors and lenders that the government has priority. The lien attaches to almost everything you own, real estate, cars, bank accounts, and even property you acquire later, and stays in place until the tax debt is fully paid or resolved.
To establish priority over other creditors, the IRS files Form 668(Y), the Notice of Federal Tax Lien. The filing is governed by IRC § 6323. To protect the government’s ability to collect, the IRS records this document in the public records where you live or where your business operates.
The procedural sequence typically follows this path:
The filing of a Notice of Federal Tax Lien triggers immediate financial paralysis. It is designed to secure the government’s position, often at the expense of your livelihood.
Federal law provides specific due process rights to challenge a lien filing. The IRS must notify you within five business days after the filing of the NFTL. This notice triggers a strict 30-day window to request a Collection Due Process (CDP) Hearing. This is your primary opportunity for a tax lien defense attorney to contest the filing before an independent appeals officer.
To exercise this right, you must file Form 12153 within the 30-day deadline. A timely CDP request offers powerful protections:
If you miss the 30-day CDP window, you may still request an Equivalent Hearing within one year. While this grants a review by Appeals, it does not provide the same judicial review rights as a timely CDP hearing.
Even if a lien has been filed, the Internal Revenue Code provides several mechanisms to remove it or reduce its impact. As your IRS lien removal lawyer, we determine which statutory tool best serves your financial goals and financial recovery strategy.
Remedy | What It Does | Main Eligibility | Best For |
Release | Fully removes lien | Full payment, expired CSED, or bond. | Debt fully paid or unenforceable. |
Withdrawal | Removes public notice (credit repair) | Improper filing or Direct Debit IA (Fresh Start). | Improving credit/title without full payoff. |
Discharge | Removes from one specific asset | IRS paid from the sale proceeds or property value is sufficient. | Selling/refinancing a single property. |
Subordination | Lets another creditor go ahead of the IRS | Benefits of IRS collection (e.g., refinancing). | Getting new financing despite a lien. |
The IRS carries the burden of proving that the lien filing adhered to all procedural requirements. A Notice of Federal Tax Lien is not valid simply because a balance is owed; the process must be executed correctly. Procedural defects in any of these steps can be grounds for withdrawal or release.
To sustain the filing, the administrative record must show:
A tax lien is often the precursor to enforced collection. While a lien secures the government’s interest, a levy seizes the asset. If the lien remains unresolved, the IRS typically escalates to:
Early legal action preserves your negotiation leverage. Once the IRS moves from lien filing to active seizure, your options for a favorable resolution narrow significantly.
At McCauley Law Offices, we do not treat the IRS’s filing as final. We scrutinize the administrative record for errors and leverage federal statutes to protect your property rights. Unlike general tax practitioners, we focus on the specific procedural defects that can invalidate a lien.
At McCauley Law Offices, we apply federal tax protocols to challenge improper liens and negotiate resolutions that clear your title. Request a confidential lien review to speak directly with a federal tax enforcement attorney.
We follow a structured protocol to secure relief:
Contact McCauley Law Offices to arrange a confidential consultation and discuss your case.
Question | Answer |
What is a Notice of Federal Tax Lien? | It is a public document filed by the IRS to alert creditors that the government has a legal right to your property. It secures the tax debt against your current and future assets, damaging your credit and title. |
Does a tax lien affect my credit? | Yes. While credit bureaus no longer list tax liens on standard consumer credit reports, lenders still search public records. A filed lien significantly damages your ability to get a mortgage, car loan, or business financing. |
Can the IRS seize property immediately after filing a lien? | Not necessarily. The lien secures the government’s interest. An actual seizure requires a separate action called a levy. However, the lien is a clear warning that enforced collection (levy) is the likely next step. |
How long does a federal tax lien last? | A tax lien generally lasts for 10 years from the date the tax was assessed (the Collection Statute Expiration Date). However, this period can be extended by bankruptcy, Offer in Compromise applications, or CDP hearings. |
Can a lien be removed if I enter an installment agreement? | Yes, in specific cases. If you owe under $25,000 and enter into a Direct Debit Installment Agreement, you may qualify to have the lien withdrawn after making three consecutive direct debit payments. |
What happens if I sell property with a lien? | The IRS lien attaches to the property. You generally cannot transfer a clear title unless the IRS is paid from the sale proceeds or issues a “Certificate of Discharge” for that specific property. |
Does bankruptcy eliminate a tax lien? | Bankruptcy may discharge personal liability for older income taxes, but it often does not remove a recorded tax lien from property you owned before filing. The lien typically survives the bankruptcy. |
A taxpayer’s plans to refinance their house took an unfortunate turn upon discovering an IRS tax lien on their property. The lien’s priority status deterred mortgage companies from proceeding with the refinancing, creating financial strain. At this critical juncture, the taxpayer reached out to McCauley Law office for guidance. Our attorneys skillfully navigated the situation, negotiating a lien subordination agreement with the IRS. This accomplishment enabled the taxpayer to refinance their property, saving them hundreds of dollars monthly on mortgage payments. For those grappling with federal tax liens, our attorneys offer valuable insights to explore feasible solutions.
