The Commerce Journal,Business and Local Businesses
*The Commerce Journal>>>United States Taxes

Will tax liens be removed from credit after bankruptcy?


I am helping a family member get her life back on track. It looks like her best option may be bankruptcy.

If there is an unsecured, unpaid federal tax lien on her credit, will it be removed when she declares bankrupcy, or is it on there forever (unless she pays it)? I do not know how the situation came about, but the liens were placed against a home that was sold 10 years ago.

Even after it is paid, it will stay on there. If bankrputcy is filed, the lien will stay on there. And by filing bankruptcy, that probably will not even relieve your family member of that tax lien as they can withhold future tax refunds.

A TAX LIEN WILL NOT BE REMOVED UNLESS YOU PAY IT OFF
IT IS BEST THAT YOU PAY IT OFF AND AVOID ACCUMULATING PENALTIES AND FINES IT IS NOT GOING AWAY.EVEN AFTER YOU PAY IT OFF IT WILL STAY IN YOUR CREDIT REPORT FOR 11 YEARS.YOU MAY TRY "DEALING "WITH THE IRS TO TRY TO REDUCE THE AMOUNT OWED OR TRY LOOKING FOR A COMPANY THAT DEALS WITH THIS KIND OF SITUATIONS
THEY CAN DEAL WITH THE IRS BUT THEY CHARGE YOU A FEE FOR THEIR SERVICE....GOOD LUCK

A federal tax lien is not normally placed on a particular piece of property but attaches to all the taxpayer's property or rights to property.

If the lien is over 10 years old and was not extended and refiled, it is self-releasing and states so quite clearly. Credit reporting agencies don't seem to pick up on this. You should get a copy of the notice of lien and determine if it is still valid before considering bankruptcy. You can also call IRS at 800-829-1040 and ask if the account is still on the books.

Also, IRS is required to send all taxpayers a balance due notice at least once a year stating what type of tax is owed and the current balance due. The notice does not contain any threatening wording, just the balance due and a polite request for payment. If your family member has not received such a notice in the past few years, that means the balance due is zero.

I am an enrolled agent, licensed by the US Treasury Department to represent taxpayers the same as CPAs and attorneys and specialize in taxpayers who have balance due problems. If you have any questions you would like to ask outside this forum, you can email me through my profile.

Were the tax liens not paid when the house was sold? If not they don't just magically go away. Your family member should see a bankruptcy attorney about the possibility of getting those liens removed. SOME tax debt is dischargeable if it's over three years old when they filed bankruptcy, but it depends and the best person to talk to about that is a bankruptcy attorney.

Tags
  Austin   Atlanta   Other - Business & Finance   Other Taxes   United States Taxes   United Kingdom Taxes   Spain Taxes   Singapore Taxes   Mexico Taxes   Ireland Taxes   India Taxes
Related information
  • Starting new work, and need help with W4, so i can get the biggest possible check w.o getting in trouble?

    If you need help filling out the worksheet, call the IRS at 1-800-829-1040

    ...
  • Tax liability?-out of court settlement-HELP!!!?

    Settlements are tax free for physical injury. Emotional distress is not considered physical injury. I would expect your wife to receive a 1099-Misc for the $123,000. If so, it's other inc...

  • Taxes. My wife and i have have a 2 year old son and i lost my job after 8 years. Ive been collecting?

    Together.

    ...
  • Taxes - How do you file partial deductions?

    If you want to take the tuition and fees deduction, you can deduct the full amount (up to $4,000) if your AGI (with some modifications that do not apply to many) is $65,000 or less. If your MAGI i...

  • Commercial property basis?

    The basis is the lower of cost plus capital improvements or fair market value.

    ...
  • Is this income tax delay definite? and when is the earliest i can file taxes?

    As of yesterday, the word was January 14th was the soonest you could file.

    ...
  • Do I have to fill out a Schedule D form just for one $2. short-term capital gain?

    Of course you do! The IRS will only know about what you sold the stock for, not what you paid for it. If you bought a single share of Berkshire Hathaway for its current price of $141,100 and sold...

  • How do I get my annual W2 income statement electronically?

    You'll have to ask your employer how to do that. That is optional with the employer, there is no central repository for that information.

    ...
  •  

    Commerce Categories--Copyright/IP Policy--Contact Webmaster