Federal Tax Links Vs Credit Report
Nobody likes to pay taxes. April 15 comes too fast every year, and people have to find money to pay Uncle Sam. Some people just can’t get the money; others simply do not contribute the money. Either way, if you don’t pay your taxes, the government will put a bond on your property until the debt is paid in full. This tax link will be attached to all of your assets; property, vehicles, stocks and bonds. It will restrict your chances of getting credit, and if you file for bankruptcy, the bond will most likely continue after bankruptcy. Those are some good reasons to avoid a bond and pay your taxes on time.
This federal lien is a document that is filed in the county where the taxpayer lives or does business. It informs the general public that this person has a tax debt. Once this link is attached to the person’s property and the owner sells this property, the IRS will receive payment for the sale before it is paid to the taxpayer. Over time, the credit bureau will take care of this link and it will appear on your credit report.
There are situations in which the links can be removed; if the balance is canceled, if there is a commitment or if the link has expired after the limitation period of ten years. There are two ways to remove a link on your property: removal and release. Withdrawal is when the IRS dismisses the lien; maybe the link was archived in error, or was not archived in the first place, or against the wrong person. If this happens, you should contact the IRS immediately so they can review your account and begin working on the documentation to remove the link. Releasing a federal lien means that the lien is not a detriment to your property. Links can be released 30 days after any outstanding taxes have been paid or if you establish a guaranteed payment agreement. However, the fact that there was once a federal lien on your property will remain on your credit report for up to ten years.
Requesting and setting up a partial installment agreement is easy and takes less time than requesting a commitment. With a partial payment agreement, the taxpayer makes monthly payments to the IRS, but the taxes are never paid in full. Once the agreed term for payment has elapsed, the rest of the debt is forgiven. If you are overwhelmed by a huge tax debt, this is one of the best ways to take that weight off and get out of tax debt.