What is a Federal Tax Lien?

A Federal Tax Lien is a public notice that you owe money to Internal Revenue Service (IRS).  The filing of a lien does not result in the immediate taking of your property, but it may limit the your ability to sell or refinance your assets without the paying the tax due to the IRS.

If a Federal Tax Lien is filed against there are a few negative results:

1. You will be absolutely hounded by Tax Relief Companies promising to resolve your balance due for less than the full amount owed.
2. You will be limited in your ability to sell or refinance your home.
3. If you wish to purchase a home, then your lender will likely require you to pay off the balance due to the IRS before closing on your loan.
4. You may have to take additional steps to qualify for security clearance for certain government and military jobs.

If a Federal Tax Lien is filed it will not show up on your credit report or reduce your credit score.  The three major credit agencies -- Experian, Equifax, and TransUnion -- stopped including tax liens on credit reports in 2018.

If you need to remove a tax lien, then the most common resolution steps are to:

1. Full pay the balance due,
2. Request a Federal Tax Lien Release,
3. Settle the tax debt through an Offer in Compromise, or
4. Wait out the Collection Statute Expiration Date (CSED) and have the lien self-release.