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IRS Lien—Denver, Colorado
Federal liens are legal claims on your business assets
If you don’t pay your tax debt or make arrangements to pay the debt before the due date, you can face enforcement action with an IRS tax lien. The first step in the forcible collection of your tax debt is a lien on your Denver-area business, which is how the IRS protects the debt.
A lien is a legal claim against your business assets, filed via a public document known as a Notice of Federal Tax Lien. The lien alerts creditors and finance companies that the IRS has a legal right to your property to the extent of tax you owe and remains in effect until the taxes are paid in full or other arrangements are made.
A lien is not the same as a levy, which allows the government to seize your company’s property and assets to pay your tax debt. Instead, the lien secures your debt using your real estate, bank accounts, intellectual property and physical property, such as office equipment, as collateral.
A lien is public information and includes the full amount your company owes the IRS. In most cases, a lien happens when your business receives a Demand for Payment and fails to pay the debt—usually 10 days after the IRS issues the Demand for Payment. You will not be notified of a lien on your company’s property and assets until after it has been filed.
Liens are filed in the Colorado county where your executive offices are located or where major executive decisions are made. If you neglect or refuse to pay your tax debt, tax liens can follow you around, damaging your company’s credit and making it impossible to move forward financially.
Impact on Company
An IRS lien can be applied to your company’s real estate property, business bank accounts, and intellectual property—those you own at the time the lien is filed and any property obtained during the lien period. It also applies to all rights to business property, including current and future accounts receivable until the lien is removed—limiting your cash flow and possibly forcing your business to shut down.
IRS liens can hinder your ability to obtain credit in the future as it not only shows up on your commercial credit report but affects your business credit score as well. In fact, the longer it’s open, the more damage done to your credit. In some cases, the Federal Tax Lien will even survive the filing of a bankruptcy and show on your credit report for years after the bankruptcy has been discharged. Liens can inhibit companies trying to sell or refinance property, and impact cash flow by attaching to accounts receivable.
Removing a lien
The best way to remove a lien from your Denver-area business is to pay your debt in full. If that’s not an option, you can satisfy your lien through a monthly payment plan or Offer in Compromise or by establishing a hardship to show your company is unable to pay its debt. Other options include requesting a withdrawal of the lien, which removes the public notice of the debt but not the debt itself.
After you have paid your business taxes in full or satisfied your IRS lien in another way, the lien can remain on your commercial credit reports indefinitely—affecting your credit despite the resolution. You can request a letter from the IRS that shows your business has paid the lien in full, which you can then send to credit agencies to show the lien has been released.
True Resolve is ready to help.
It’s never wise to avoid your business’ tax issues. And you don’t need a tax attorney to help you resolve them. Contact the qualified tax advisors at True Resolve for help in satisfying your lien, so you can get back to your day-to-day business. Our Denver-based Enrolled Agents have the expertise and experience to work with the IRS on behalf of your company.
Call us to request help resolving your company’s back taxes or IRS lien.