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How to Get Rid of an IRS Tax Lien

How to Get Rid of a Tax Lien

An IRS tax lien showing up on your credit score can be very damaging to your ability to get a mortgage or any kind of loan. There are several ways of getting rid of a tax lien but they are not suitable for everyone. You should consider your situation carefully or even consult with a professional tax accountant before you take any of the below routes.

Pay In Full

This is the most efficient way to totally get rid of a tax lien, but it may not be suitable for many individuals if your tax debt amount is too high. There are very few people that can afford to pay more than $10,000 within the IRS deadline. However, if by some means you can do it, the tax lien will be cleared of your name and account within 30 days.

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Discharge of Property

You may want to try to sell a property which has been stamped with a tax lien, but it won’t be easy to find a buyer. More importantly, this method does not actually guarantee that you will get rid of the tax lien. You can read about the eligibility criteria here.

Withdrawal

This method may be the most accessible to many individuals, however, it takes a long time to be completed and get rid of the tax lien – up to 5 years. To qualify you must:

  • Owe less than $25,000 in tax debt.
  • Have set up a monthly direct debit payment.
  • Have not missed a payment in the last three months.

The IRS will respond to your application within 45 days and if accepted they will remove the tax lien. You will also be given a notification letter of the tax lien removal, which you can show to creditors if you need to take a loan before the process is completed.

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Fulton Abraham Sanchez, CPA

Fulton Abraham Sánchez, CPA is a Certified Public Accountant, specialized in Tax Planning for Real Estate, Hedge/Equity Funds, Fintech, Crypto, Expats, IRS Debt Resolution and Offshore Strategies. You can email him to fa@fascpaconsultants.com and follow us on Facebook : FAS CPA & Consultants.

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