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tax lein

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if i pay a tax lein will that hurt or help my credit score ...from my understanding the lein won't be removed unitil 7 years from the date paid is this correct ...will this bring this account current and hurt my score if i pay it

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I have never heard that paying a tax lein will hurt your score as in the case of paying a CA or CO.

Regardless, a tax lein is a public record that is more damaging unpaid than paid. When applying for credit- an unpaid tax lein sticks out like a sore thumb to creditors

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if i pay a tax lein will that hurt or help my credit score ...from my understanding the lein won't be removed unitil 7 years from the date paid is this correct ...will this bring this account current and hurt my score if i pay it

An unpaid tax lien does not get removed after 7 years as the government does not like to get "stiffed". It is better to pay the lien so that it can be removed in a timely manner. I had one but it was paid and it fell off in the 7 year period. :)++

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Paying is only part of the picture. You need to obtain a Release of Lien. Be sure to have this recorded in the same jurisdiction the Lien was recorded in. Liens attach to real property, so having the disposition is paramount.

Unpaid liens put the k'bosh on any major lending you want to do, so forget the damage to your score and look at the bigger picture. You gotta pay this eventually, so go ahead and bite the bullet.

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The 7 year time period begins after the tax lien is paid. Until it is paid, it stays on your credit report forever

"(3) Paid tax liens which, from date of payment, antedate the report by more than seven years.

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Exactly right Methuss, but the court doesn't report the date of payment, they report the date of release.

It is VERY important that you get the release of lien filed.....for the State of CO you had to request it and I only found that out over 7 years after I paid it. The CRAs were going to use the release date even after I sent them proof that I had paid it 7+ years before. It took an ITS with the quote you posted to get the CRAs to delete it!

It pays to be persistent.

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The 7 year time period begins after the tax lien is paid. Until it is paid, it stays on your credit report forever

"(3) Paid tax liens which, from date of payment, antedate the report by more than seven years.

It was my understanding that a UNPAID Tax lien stayed for only 10 years unless it was "renewed".

I just disputed some on EX with "Date Filed" from the mid '90s as "other" Reason: "obsolete, older than 10 years".

I hope I didn't screw up!

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No politics here, just tax talk. EVERYONE has taxes.

IRS tax liens become invalid after ten years if not renewed. That doesn't mean a CR entry will get removed at that time. As I've said before, CRA employees barely know the FCRA. They sure don't know tax code, the intricacies of tax liens or state law. They may read the section quoted by Methuss and leave a lien on even after 10 years. It's not an uncommon situation.

Ditto what mom said...

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The mentioning of taxes brings up references to to the IRS, which is a government agency. Government agencies could lead to politics. Can't talk about it.

Kirk, are you the one smarting from a spanking in another thread??? ;)

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No politics here, just tax talk. EVERYONE has taxes.

IRS tax liens become invalid after ten years if not renewed. That doesn't mean a CR entry will get removed at that time. As I've said before, CRA employees barely know the FCRA. They sure don't know tax code, the intricacies of tax liens or state law. They may read the section quoted by Methuss and leave a lien on even after 10 years. It's not an uncommon situation.

Ditto what mom said...

Ahntara, when you say "invalid" what do you mean? Are they still collectable buy the State or IRS? Or does the "liener" lose its right to collect after 10 years elapses without a renewal? And wouldn't a dispute with the CRA get it removed if the date filed is more than 10 yrs ago and no renewal? (fingers crossed...)

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in minnesota, according to a tax lawyer and the department of revinue tax leins in minnesota that are unpaid are collectiable until the cows come home.

So, 25% of my check at a time, they are getting their money on a 13 year old lein. What chapps my butt is the insaine fees.. Started off at 7200 bucks, I now owe them 15000 and that is after they have got 2500 from me! They are worse than a CA, however, they are doing it legally.

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Don't mess with the feds. They make their own rules and will get paid!

Regarding the amount: the fees are really high for non-filings, but are relatively low for non-payment. Moral of that story is even if you'll owe a ton, file a return on time and then deal with non-payment later. Better yet, set up a payment plan.

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"...what do you mean..."

I'm no legal expert. But I believe the verbage implied that the lien itself (against property) becomes invalid after 10 years, if not renewed. I first heard this from an attorney and then read the info myself. That was years ago, though.

"...collectable until the cows come home..."

That's my understanding also. So if the lien (against property) becomes invalid if not renewed, apparently that doesn't prevent other collection efforts.

"...dispute with CRA get it removed..."

That's been my experience. But merkurfan's experience shows that, once again, something not appearing on your CR doesn't mean collection efforts cease or that it won't bite you some other way. All and all, I'd rather have a CR entry than a garnishment, especially at 25%. Ouch!

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"...what do you mean..."

I'm no legal expert. But I believe the verbage implied that the lien itself (against property) becomes invalid after 10 years, if not renewed. I first heard this from an attorney and then read the info myself. That was years ago, though.

"...collectable until the cows come home..."

That's my understanding also. So if the lien (against property) becomes invalid if not renewed, apparently that doesn't prevent other collection efforts.

"...dispute with CRA get it removed..."

That's been my experience. But merkurfan's experience shows that, once again, something not appearing on your CR doesn't mean collection efforts cease or that it won't bite you some other way. All and all, I'd rather have a CR entry than a garnishment, especially at 25%. Ouch!

Amend my earlier comment to change 'invalid" to "unenforceable due to lapse of time". Much better description....I didn't read the whole wiki entry. Did anyone see a time frame?

I appreciate everyones input, but I'm totally confused now. If a lien becomes "invalid" or "unenforceable due to lapse of time", but IS still VALID and ENFORCEABLE, then what the heck do the terms "invalid" and "unenforceable due to lapse of time" mean??? HELP!!!

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I have a tax lien on my CR from 9/1992. It was marked paid on 12/03. It says on my TU report (the only one reporting) that it will be removed 11/2010.

I have searched the internet and what I find is, it remains for 7 yrs after PAID.

I dunno but I cant wait for it to go away..........

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Here's what I make of the statute. The Service files a lien. It is valid for 10 years. If, after 11 years and one month they have not levied on it or renewed it, then it is no longer enforceable. If they do refile, they have 10 more years. If AGAIN, after 11 years and one month, they have not levied on it or renewed it a second time, then it is no longer enforceable. If they have renewed it, then it is valid for 10 more years. So if the federal government dots their i's and crosses their t's, then they get a 30 year crack at collecting on their lien amount with interest accruing at the federal statutory rate (the rate goes up and down based on interest rates).

Maybe you can settle with them? Or just pay it if it is small, or if it is large debt, then speak to an attorney to negotiate.

-------------------------------------------------

§ 6502. Collection after assessment

How Current is This?

(a) Length of period Where the assessment of any tax imposed by this title has been made within the period of limitation properly applicable thereto, such tax may be collected by levy or by a proceeding in court, but only if the levy is made or the proceeding begun—

(1) within 10 years after the assessment of the tax, or

(2) if— (A) there is an installment agreement between the taxpayer and the Secretary, prior to the date which is 90 days after the expiration of any period for collection agreed upon in writing by the Secretary and the taxpayer at the time the installment agreement was entered into; or

(B) there is a release of levy under section 6343 after such 10-year period, prior to the expiration of any period for collection agreed upon in writing by the Secretary and the taxpayer before such release.

If a timely proceeding in court for the collection of a tax is commenced, the period during which such tax may be collected by levy shall be extended and shall not expire until the liability for the tax (or a judgment against the taxpayer arising from such liability) is satisfied or becomes unenforceable.

(B)Date when levy is considered made The date on which a levy on property or rights to property is made shall be the date on which the notice of seizure provided in section 6335 (a) is given."

Section 6323:

(3) Required refiling period In the case of any notice of lien, the term “required refiling period” means—

(A) the one-year period ending 30 days after the expiration of 10 years after the date of the assessment of the tax, and

(B) the one-year period ending with the expiration of 10 years after the close of the preceding required refiling period for such notice of lien.

...A general federal tax lien may be renewed by refiling the Notice of Federal Tax Lien. In order to maintain the enforceability of the lien from date of assessment through the renewal period, a notice of lien must be refiled within the one-year period ending thirty days after the expiration of the applicable six or ten year period discussed above. If the Notice of Federal Tax Lien is not refiled during this period, the lien shall be deemed to have expired at the end of the applicable limitation period. Provisions exist in the statute for a second and subsequent renewal of the lien period by a second refiling of the notice of lien within the time periods set out in the statute. 26 U.S.C.A. § 6323 (g)...

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From what I seem to know is (notice the qualifier...)

Federal Tax Liens stay on your CR for 7 years AFTER being paid and 10 years if NOT paid or renewed before the original 10 year period expires. And they can be renewed indefinitely.

Discussions of same topic and some great links in:

http://www.debt-consolidation-credit-repair-service.com/forums/showthread.php?t=279276

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what jq26 said

But, does an expired unpaid tax lien mean the tax debt is "forgiven" or "uncolectable" now? Or can the IRS just file a new lien for the same old tax debt?

And what if you were on a "installment" plan and just quit making the payments (but there were no collection attemps made by the IRS other than letters saying you owed them)?

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I think JQ26 has made it as clear as possible, it is complicated. Especially when dealing with the IRS.

I think that if it is not renewed in the 10 yr time limit it becomes unenforceable by way of a lien.

As far as the installment default, I would think that it remains a "new" debt from the time of default but I have nothing to base this on........

Why not try to call the IRS and ask them without giving them your name?

I think this is a common confusing issue that I have seen several posts on, one of which was mine.

It sure would be great to have a tax collector chime in and lay it all out in laymens terms in regards to the various situations we find ourselves in.

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If i were you i'd just pay it. Screwing the government out of money is about the dumbest thing you can do. (no offense.)

Even IF you got it removed from your credit report, you'd still owe the money, and they can still withhold state taxes and cause you grief in other ways.

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