Sacramento Accountant for IRS Liens on Your Business
Cook CPA Group
Having a tax lien placed on your business can have serious, detrimental consequences, including wage garnishment, damaged credit, property seizure, and other effects upon a person’s bankruptcy and maintenance of assets. Business owners that have had liens placed on their businesses should not waste any time getting in touch with a qualified, experienced CPA.
The experienced accountants that work with Cook CPA Group can help business owners get rid of tax liens placed against them and move on toward better financial health. If you are a business owner who has had a tax lien placed against your business, get in touch with Cook CPA Group as soon as possible by calling (916) 432-2218.
What Is an IRS Tax Lien?
A tax lien is a penalty placed on a person or business that has refused or neglected to pay their taxes. These may be related to property taxes, income taxes, gift taxes, or estate taxes. Liens can be placed on an individual or a business by either the IRS or the state or county in which they reside. The IRS will give you an opportunity to pay the taxes they owe before a lien is placed on you. The process begins with the IRS determining your tax liability, sending you a Notice and Demand for Payment, and then, if you do not pay the debt, filing a Notice of Federal Tax Lien.
A tax lien is a public document that states that the government has a legal right to your property as a result of your failure to pay taxes. A tax lien lets your other creditors know that the government’s debt takes precedence over theirs. Tax liens are similar to, but ultimately different from, tax levies, which involve the actual seizure of property; tax liens are an IRS notice that the government could seize your property in the near future.
The seizure of property is one possible consequence of having a tax lien placed against you. The ways in which a tax lien can affect you and your finances follow.
- You can lose out on loan opportunities. Tax liens, as of recently, do not appear on credit reports, but the IRS is still able to file public notices of tax liens, which creditors can access. A tax lien may also result in higher interest rates on loans.
- A lien can impede efforts to sell or refinance a home. Tax liens appear on title searches, so some equity on a home that you own may have to be used to pay your taxes before you close on a home sale.
- A tax lien can damage job opportunities. Tax liens go on the public record, which can be searched by prospective employers.
- A tax lien can result in the seizure of your property. Seizing property to pay for your outstanding debt is a possible outcome of failure to pay your taxes. This is known as a tax levy.
How to Have an IRS Lien Removed from Your Sacramento Business
There are a few ways that a tax lien can be removed from your record. The ways that a tax lien can be removed from your record are:
- Simply pay the balance due in full. This holds especially true if you failed to pay your taxes in the first place due to simple negligence, not a lack of funds.
- Enroll in a payment plan. If you allow the IRS to take the amount owed out of your bank account, the IRS may remove the tax lien from your record. You will still be required to pay the remainder of the debt, though. Installment plans have varying maximum balance requirements. Some people may qualify for an Offer in Compromise, which means that you settle your back taxes for less than the full amount owed.
- File an appeal. You are able to request a due process hearing from the IRS. You are also able to request a conference with any employee that has made a decision about your case.
- File for bankruptcy. Filing for bankruptcy does sometimes enable you to discharge your tax debt, which means that your tax lien will be removed as well. Not all bankruptcy cases are guaranteed to result in a discharge of tax debt, however.
- Wait until it is unenforceable. After 10 years, the lien becomes expired as a result of the statute of limitations.
An accountant can help you understand your tax obligation and help you make decisions about what to do next. One way an accountant from Cook CPA Group can help you with your IRS tax lien is by disputing the amount of taxes that the IRS says you owe. If you choose to become involved in an installation agreement or Offer of Compromise, an accountant can assist you with the process. If you are unable to pay the tax balance you owe due to economic hardship, an accountant will help you file an application for non-collectible hardship status.
Accountants in Sacramento for IRS Liens on Businesses
Don’t allow a tax lien on your business to affect the financial health and well-being of your future. Contact Sacramento accountants from Cook CPA Group at your earliest convenience to learn more about how you can resolve the tax lien that the IRS has placed on your business. Call us at (916) 432-2218 as soon as possible.