Compromise IRS Offer

One of the most common methods the IRS uses to collect back tax debts is the Lien.  Although an IRS Lien may not be quite as devastating to cash flow as a Levy, it will still be a hindrance to a taxpayer's financial plans. 

Whereas a Levy is a seizure of certain assets to satisfy a tax debt, a Lien is a legal claim on all the taxpayer's assets as security against the tax debt. This includes property acquired after the Lien was filed. Therefore it is in your best interest to begin a Compromise IRS Offer! 

A good way to think of an IRS Lien is as a red flag that the government uses to notify a person's creditors that it has a stake in their assets that must first be satisfied before those assets can be transferred or sold.  Though an IRS Lien does not prevent the taxpayer from using the affected assets (that is, you are still allowed to live in a Liened house, you can still drive a Liened car) the property could not be sold because of the Government's secured interest in that property. For example, a Tax Lien will prevent a taxpayer from being able to sell their house because, although it technically still belongs to the taxpayer, the Lien gives the IRS a superior claim to it, up to the full value of the Tax Lien.  A Tax Lien will usually prevent a person from obtaining a loan or credit card because of the instant damage it does to their credit rating. So why live in fear, start a "Compromise IRS Offer" today and rid yourself of the stress, at a reduced rate!

Technically it is only possible to have an IRS Lien removed after the tax debt has been repaid in full, so when a taxpayer receives a Notice of Federal Tax Lien it means that the IRS has become aware of their debt and it is time to pay up. If the taxpayer cannot afford to repay the debt all at once, they may be able to submit an Compromise IRS Offer to reduce the debt amount, perhaps 20 cents on the dollar, or set up a Payment Plan to pay if off over time. Keep in mind however, that the Lien still applies until the tax debt is completely repaid.

The IRS will also sometimes grant a Lien Subordination. Lien Subordination allows another creditor to take a superior claim against the property in order for the owner to obtain some sort of private financing, such as a home equity loan. But the IRS will only do so when the taxpayer promises to use any net proceeds from the sale or financing to pay off the tax debt, up to the total amount of the Lien. 

If the taxpayer decides to give up the property, then he or she may petition the IRS for a Discharge of a Federal Tax Lien. Again however, the IRS will only grant the discharge if the proceeds of the sale (net of closing costs) will be paid to the IRS up to the total amount of the Lien, or if they reasonably expect that doing so would increase the amount that they could eventually collect. Basically, you need to show the IRS, what's in it for them. So, save you money and ask us about the "Compromise IRS Offer"

Generally, an IRS Lien lasts for ten years from the time the tax is assessed and then automatically releases, unless it is re-filed by the IRS.

Sensible Solutions Tax Relief is highly effective at helping taxpayers settle IRS and State tax debts. We can help you get back into compliance and out of debt faster with a Compromise IRS Offer, so that you can get Liens out of your life, and prevent further IRS Collections action.

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