Business Tax Lien Help in NYC

Federal Liens are Legal Claims on Your Business Assets

A federal tax lien is a legal claim on your business assets. Any business that does not decide to pay their tax debt before the due date you can face an IRS tax lien. The first step federal, state, and municipal agencies make in collection of your past due debt is a lien on your business, which is how the taxing agency protects the debt. This can cause a multitude of difficulties, and it is wise to have a tax lien expert negotiate terms and conditions as quickly as possible.

A lien is filed via a public document called a Noticed of Federal Tax Lien; it is a legal claim against your business assets. Until your taxes are paid in full or alternative arrangements are made to pay them, the lien informs creditors and finance companies that the IRS or other entity has legal right to your properties to the extent of the tax amount that you owe.

A lien secures your tax debt by using your assets, such as bank accounts, intellectual property, physical property, and real estate as collateral until you pay your debt. This is not the same as a levy, which takes your company’s property and assets to pay your debt. A lien, however, can complicate many other business dealings, impact your credit, alerts any creditors of your status, and can generally make business dealings more difficult.

In most circumstances, a lien occurs when your business receives a Demand for Payment and does not pay the debt within the required amount of time set by the tax authority – usually 10 days. You will not be notified of a lien on your company’s property and assets until after it has been filed. The lien and the full amount your company owes the IRS or other tax authority will become public information at that point.

Liens are filed in the county where your executive offices are located or where your executive decisions are made. If you refuse or neglect to pay your tax debt, tax liens can damage your company’s credit and financial dealings.

Impact on Company

The IRS can place on lien against any of your company’s property – real estate, bank accounts, machinery, and intellectual property. This includes both those you own at the time the lien is filed, and any new assets obtained during the lien period. Until it is removed, a lien would also apply to all rights to business property, including current and future accounts receivable. This can lead to serious cash flow problems, and has been known to force your businesses to shut down completely.

IRS liens also impact your finances in other ways. They can hinder your ability to obtain credit. A lien not only shows up on your commercial credit report but affects your business credit score as well. The longer it’s open, the more damage it does to your credit score. In some cases, federal tax liens have survived the bankruptcies and remain to be paid. Even in the event they are discharged through bankruptcy, they will show on your credit report for years. Liens can significantly complicate any efforts to refinance a loan, sell your business, or liquidate assets. In short, liens make doing business significantly more challenging.

Removing a Lien

The fastest and easiest way to remove a lien from your business is to pay your debt in full. In many cases, that is not an option, or at least not one that can be quickly executed. You can satisfy your lien through an IRS installment agreement, which settles the full debt in manageable installments. Another option is an offer in compromise, which may involve payment plans, a reduction of fees and interest, and sometimes even other concessions from the IRS. Another alternative would be to establish a hardship to prove your company is unable to pay its debt. Another option is to  request a withdrawal of the lien, which removes the public notice of the debt, without removing the debt itself.

Even after you have paid your business taxes in full (or satisfied your IRS lien in another way) the lien will remain on your commercial credit reports indefinitely. This inevitably and adversely effects your credit, despite the resolution of your case. It is wise to request a letter from the IRS that shows your business has paid the lien in full. You or your agent should then send this letter 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 True Resolve Today to Recieve Expert Business Tax Lien Help in NYC.

Federal Tax Lien Removal Guide